Subcommittee codifies decades‑old deduction for spoiled alcoholic beverage inventory

Feb 5, 2026

The subcommittee approved CSR HB 1137 to put into statute a Division of Beverage rule that allows distributors to deduct broken or spoiled alcoholic beverages, including extraordinary losses such as storm damage, after the rule was nullified by an administrative review.

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Representative Robinson and Representative Orrador sponsored CSR HB 1137, which would codify a Division of Business and Professional Regulation rule that for about 40 years allowed wholesalers and distributors to deduct damaged, broken or spoiled alcoholic beverage inventory from excise tax reports. The sponsor told the committee the rule was nullified last November by the Joint Administrative Procedures Committee for lacking explicit statutory authorization and the bill restores that authority.

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