Monday, October 22, 2012
TTB Says Jack Daniel's Unaged Rye Isn't Neutral Spirit After All, Sort Of.
All of that makes Jack Daniel's Unaged Tennessee Rye a very important new product. Everyone wants to know what it means for both the rye whiskey and white (i.e., unaged) whiskey segments. Most people don't care that it has also created a controversy involving one of the principal regulators of the beverage alcohol industry, the U.S. Treasury Department's Alcohol Tax and Trade Bureau (TTB).
TTB's main job is collecting taxes. The tax burden on alcohol is second only to tobacco. No matter how poor you are; if you drink, you pay a boatload of tax to all levels of government, the federal government most of all.
TTB's second most important job is regulating the way beverage alcohol products are labeled and marketed. In return for all the millions we drinkers pay in taxes, TTB makes sure the products we drink are what they claim to be and are marketed responsibly. Its rule book is in the Code of Federal Regulations, where you can look it up. The part covering distilled spirits is Title 27, Chapter 1, Part 5, Subpart C, and is called the Standards of Identity for Distilled Spirits ('the Standards').
One of the rules is that every distilled spirits product has to fit into one of TTB's established classes. Whiskey, for example, is a class. Each class is strictly defined in the Standards. Jack Daniel's Tennessee Whiskey is classified as whiskey. That's why people who care about such things were shocked when Jack Daniel's Unaged Tennessee Rye was classified, not as whiskey, but as neutral spirit.
As anyone who has tasted the product will attest, it's not neutral. So why is it labeled that way? Here's the explanation from Jack Daniel's spokesperson Rob Hoskins, "Jack Daniel’s packaging and legal departments argued that the Tennessee Unaged Rye should be labeled as an 'unaged whiskey' which we felt more accurately described the nature of the product to the consumer, but the TTB ruled against this proposal and would only approve the label under the category 'neutral spirit.'"
Strange, since the Standards define neutral spirit as, "distilled spirits produced ... at or above 190° proof." Mr. Hoskins says Tennessee Unaged Rye is produced below 140° proof and is destined, after aging, to become straight rye whiskey. It is, therefore, not neutral spirit.
But then what is it?
All of this was pointed out to TTB and Thomas K. Hogue, their Director of Congressional and Public Affairs, responded. "The regulations are pretty straight forward," wrote Hogue. "Whisky is defined ... as an alcoholic distillate from fermented mash of grain produced at less than 190° proof that must be stored in oak containers. Neutral spirits must be distilled at 190° or higher. A product that is made from fermented mash of grain and produced at less than 190° of proof but not stored in oak containers would be a distilled spirits specialty product, as it would not meet any of the standards of identity."
It could, according to Hogue, be further labeled as spirits distilled from grain. He noted that corn whiskey is an exception, since it need not be stored in oak containers, but must be at least 80% corn grain.
So that means Jack Daniel's Unaged Tennessee Rye is going to change its label, right? "Any time there is a concern that an approved label does not accurately reflect the contents of the bottle, that is something that we address directly with the label holder," writes Hogue.
A comment from Mr. Hoskins at Jack Daniel's has been sought.