OMB No. 1513-0016 Supporting Statement (03-2023)

DEPARTMENT OF THE TREASURY

ALCOHOL AND TOBACCO TAX AND TRADE BUREAU

Supporting Statement –– Information Collection Request

OMB Control Number 1513–0016

Drawback on Wines Exported

Changes Since Last Approval

Changes made to the Supporting Statement since this information collection’s last approval:

• Throughout this Supporting Statement, TTB is making minor editorial and grammatical changes for clarity.

• In Question 8, TTB is updating the 60-day notice publication information for this information collection.

• In Question 12, TTB is updating the estimated respondent labor costs associated with this information collection.

• In Question 14, TTB is updating its estimate of the costs to the Federal Government for this information collection.

• In Question 15, TTB notes there are no program or adjustments associated with this information collection.

A. Justification

1. What are the circumstances that make this collection of information necessary, and what legal or administrative requirements necessitate the collection? Also align the information collection to TTB’s Line of Business/Sub-function and IT Investment, if one is used.

The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers chapter 51 (distilled spirits, wines, and beer), chapter 52 (tobacco products, processed tobacco, and cigarette papers and tubes), and sections 4181–4182 (firearms and ammunition excise taxes) of the Internal Revenue Code of 1986 (IRC, 26 U.S.C.). TTB administers these IRC provisions pursuant to section 1111(d) of the Homeland Security Act of 2002, as codified at 6 U.S.C. 531(d). In addition, the Secretary of the Treasury (the Secretary) has delegated certain IRC administrative and enforcement authorities to TTB through Treasury Order 120–01.

In general, the IRC at 26 U.S.C. 5041 imposes Federal excise tax on wine produced or imported into the United States, while section 5362(c) allows domestic wine to be exported without payment of that tax. In addition, for taxpaid or tax-determined domestic wine that is subsequently exported, the IRC at 26 U.S.C. 5062(b) provides that the exporter may claim drawback (refund) of the tax paid or determined on such wine, subject to the regulations prescribed by the Secretary.

The TTB regulations governing drawback on exported taxpaid or tax-determined wine are found in 27 CFR Part 28, Exportation of Alcohol, Subpart K, Exportation of Wine with Benefit of Drawback, which includes §§ 28.211 through 28.220a. Specifically, § 28.211 allows for drawback on taxpaid or tax-determined domestic wine that was subsequently exported, laden for use on the vessels and aircraft described in § 28.21, or transferred to a foreign trade-zone for exportation or storage pending exportation.¹ Section 28.212 provides that wholesale liquor dealers, and proprietors of distilled spirits plants, bonded wine cellars, or taxpaid wine bottling houses who are also registered as wholesale liquor dealers under 27 CFR part 31, are authorized to remove wine and receive drawback under subpart K. As required by § 28.214, such exporters file such drawback claims using form TTB F 5120.24, Drawback on Wines Exported. Section 28.218 instructs respondents on how to distribute the required copies of that form (those instructions are also described on the form).

This information collection is aligned with:

• Line of Business/Sub-function: General Government / Taxation Management.

• IT Investment: None.

2. How, by whom, and for what purpose is this information used?

To claim export drawback on the excise tax paid or determined wine that was subsequently exported, the exporter uses TTB F 5120.24 to file such drawback claims. The exporter prepares the form once for each shipment, listing the kind and amount of taxpaid wine exported, and the rate and total amount of drawback claimed. The exporter then uses copies of the form to notify TTB of the export shipment, obtain conformation of the wine’s export from an appropriate official, and submit a claim for refund or credit the excise taxes paid or determined on the exported wine.

Employees of TTB’s National Revenue Center use the finalized copy of the form filed by the exporter to ensure that the exported wine is eligible for drawback, that proper evidence of the wine’s exportation was submitted, and to calculate the amount of drawback due to the exporter for credit or refund. In addition, TTB auditors or investigators may review the file copy of the form retained by the exporter during an audit or field investigation. The collected information and its verification by TTB are necessary to ensure compliance with relevant laws and regulations and to protect the revenue by preventing payment of incorrect or fraudulent drawback claims.

3. To what extent does this collection of information involve the use of automated, electronic, mechanical, or other technological collection techniques or other forms of information technology? What consideration is given to use information technology to reduce burden?

TTB has approved and will continue to approve, on a case-by-case basis, the use of improved information technology for the collection and maintenance of required information. Currently, TTB F 5120.24 is available as a fillable-printable form on the TTB Web site at https://www.ttb.gov/forms.

4. What efforts are used to identify duplication? Can similar information already available be used or modified for use for the purposes described in Item 2 above?

The collected information is pertinent to each respondent and specific to the drawback claim made for a particular export shipment of taxpaid or tax-determined domestic wine. As far as TTB can determine, similar information is not available elsewhere.

5. If this collection of information impacts small businesses or other small entities, what methods are used to minimize burden?

To ensure compliance with relevant laws and regulations and protect the revenue by preventing payment of incorrect or fraudulent drawback claims, all entities, regardless of size, are required to provide information regarding drawback claims for taxpaid or tax-determined domestic wines that are subsequently exported. The required information is the minimum necessary to document the kind and type of wine exported, confirm its exportation, and verify the amount of drawback claimed.

6. What consequences to Federal program or policy activities and what, if any, technical or legal obstacles to reducing burden will occur if this collection is not conducted or is conducted less frequently?

Under the IRC at 26 U.S.C. 5362(c), domestically produced wines may be exported without payment of excise tax. For taxpaid or tax-determined domestic wine that is subsequently exported, if TTB did not conduct this information collection, it could not verify drawback claims for the excise taxes paid or determined on such wine. Therefore, this information collection is necessary to protect the revenue. In addition, as exporters only complete this information collection when making an export drawback claim, it cannot be conducted less frequently.

7. Are there any special circumstances associated with this information collection that would require it to be conducted in a manner inconsistent with OMB guidelines? (See 5 CFR 1320.5(d)(2).)

Under the OMB regulations at 5 CFR 1320.5(d)(2)(iii), requiring respondents to submit more than an original and two copies of any document is a special circumstance. The instructions for TTB F 5120.24 require respondents to prepare four or five copies of the form for distribution to TTB, customs or U.S. Armed Forces officers, or a consignee, depending on circumstances. In addition, the exporter must keep a record copy of their drawback claim forms. These multiple copies and the required certifications on them, are required in order to provide TTB with the information necessary to verify the exportation of the wines for which drawback is claimed.

8. What effort was made to notify the general public about this collection of information? Summarize the public comments that were received and describe the action taken by the agency in response to those comments.

To solicit comments from the general public, TTB published a “60-day” comment request notice for this information collection in the Federal Register on November 18, 2022, beginning at 87 FR 69386. TTB received no comments on this information collection in response.

9. Was any payment or gift given to respondents, other than remuneration of contractors or grantees? If so, why?

No payment or gift is associated with this information collection.

10. What assurance of confidentiality was provided to respondents, and what was the basis for the assurance in statute, regulations, or agency policy?

TTB provides no specific assurance of confidentiality is provided for this information collection. However, Federal law at 5 U.S.C. 552 protects the confidentiality of proprietary information obtained by the Government from regulated businesses and individuals, and 26 U.S.C. 6103 prohibits disclosure of tax returns and related information unless disclosure is specifically authorized by that section. TTB maintains the collected information in password-protected computer systems and in secure file rooms with controlled access.

11. What is the justification for questions of a sensitive nature? If personally identifiable information (PII) is being collected in an electronic system, identify the Privacy Impact Assessment (PIA) that has been conducted for the information collected under this request and/or the Privacy Act System of Records notice (SORN) issued for the electronic system in which the PII is being stored.

This information collection contains no questions of a sensitive nature. In addition, this information request does not collect personally identifiable information (PII) in an electronic system. Therefore, no Privacy Impact Assessment (PIA) or System of Records Notice (SORN) is required for this collection.

12. What is the estimated hour burden of this collection of information?

Estimated Respondent Burden Hours: Based on recent data, TTB estimates that 40 respondents will each annually file 4 export drawback claims on form TTB F 5120.24, resulting in a total of 160 responses. TTB also estimates that each response will require 67 minutes (1 hour and 7 minutes) to complete, resulting in an estimated total annual burden of 179 hours.

Respondent Record Retention: Per the TTB regulations at 27 CFR 28.45, respondents must maintain file copies of any form required under part 28, along with any supporting documents and records for that form, for a period of not less than two years.

Estimated Respondent Labor Costs: Based on the average fully-loaded labor rate of $45.24 per hour for compliance officers employed in the beverage manufacturing industry, TTB estimates the per-respondent and total respondent labor costs for this information collection as follows:²

Respondent Labor Costs for OMB No. 1513–0016 (Fully-loaded Labor Rate for Beverage Industry Compliance Officers)
Avg. Time / Response	Fully-loaded Labor Rate / Response	Responses / Respondent	Labor Costs / Respondent	Total Responses	Total Labor Costs
67 minutes	$45.24	4	$180.96	160	$7,238.40

* The fully-loaded labor rates and respondent labor costs rounded to the nearest whole cent.

13. What is the estimated annual cost burden to respondents or record keepers resulting from this information collection request (excluding the value of the hour burden in Question 12 above)?

TTB believes that this occasional information collection imposes no annualized capital, start-up, maintenance, operational, or other costs on its respondents. However, TTB estimates that respondents have postal and mailing supply costs of up to $5.00 per response to this collection, for a total of up to $800.00 for 160 annual responses.

14. What is the annualized cost to the Federal Government?

TTB estimates of the annual costs to the Federal Government for this information collection are as follows:

General costs: TTB has determined that it has no overhead costs for this occasional information collection. In addition, printing and distribution costs to the Federal government for this information collection have decreased to $0.00 due to the availability of TTB forms on the TTB Web site at https://www.ttb.gov/forms.

Labor costs: TTB estimates is annualized labor costs this information collection as follows:

Labor Costs for OMB No. 1513–0016 for TTB Personnel at the National Revenue Center in Cincinnati, Ohio
Position	Fully-loaded Labor Rate per Hour3	Processing Time per Response	Labor Costs per Response	Total Responses	Total TTB Labor Costs
GS–5, Step 5, Clerk	$34.75	12 minutes	$6.95	160	$1,112.00
GS–12, Step 5, Specialist	$76.37	18 minutes	$22.91		$3,665.60
TOTALS	($59.72)	30 minutes	$29.86	160	$4,777.60

15. What is the reason for any program changes or adjustments reported?

There are no program changes or adjustments associated with this information collection, and TTB is submitting it for extension purposes only.

16. Outline plans for tabulation and publication for collections of information whose results will be published.

TTB will not publish the results of this information collection.

17. If seeking approval to not display the expiration date for OMB approval of this information collection, what are the reasons that the display would be inappropriate?

TTB will display the expiration date for OMB approval of this information collection on its collection instrument, form TTB F 5120.24, Drawback on Wines Exported.

18. What are the exceptions to the certification statement?

(c) See Item 5 above.

(f) This is not a recordkeeping requirement.

(i) No statistics are involved.

(j) See Item 3 above.

B. Collections of Information Employing Statistical Methods.

This information collection does not employ statistical methods.

1 Hereafter, references to exports of taxpaid or tax-determined domestic wine includes those exported to a foreign country, laden for use on the vessels and aircraft described in 27 CFR 28.21, or transferred to a foreign trade-zone for exportation or storage pending exportation. Also, per the instructions on TTB F 5120.24, shipments of taxpaid or tax-determined wine sent to U.S. Armed Forces stationed overseas are considered exports for drawback purposes.

2 Private Sector Fully-loaded Labor Rate = Hourly wage rate x 1.44 to account for employee benefit costs. Per the most recent U.S. Department of Labor, Bureau of Labor Statistics (BLS), data for National Industry-Specific Occupational Employment and Wage Estimates for NAICS 312100—Beverage Manufacturing, the mean hourly wage for Compliance Officers (13–1041) is $31.42 per hour, which results in a fully-loaded labor rate of $45.24 per hour. See https://www.bls.gov/oes/current/naics4_312100.htm.

3 Federal Government Fully-loaded Labor Rate = Hourly wage x 1.63 to account for employee benefit costs. Per the most recent Office of Personnel Management (OPM) salary tables for Federal employees in the Cincinnati, Ohio, wage region, the hourly fully-loaded wage rates for TTB employees are: (1) $34.75 for GS–5 (step 5), and (2) $76.37 for GS–12, step 5. See https://www.opm.gov/policy-data-oversight/pay-leave/salaries-wages/salary-tables/pdf/2023/CIN_h.pdf. Dollar figures are rounded to the nearest whole cent.

OMB No. 1513–0016 Supporting Statement (03–2023)