Adrienne Fairwell (firstname.lastname@example.org)
For Immediate Release
March 3, 2010
Notice to Beer Producers and Wholesalers Concerning Racks and Stone Enhancers
The Department of Revenue has received inquiries concerning racks and store enhancers to be furnished to beer retailers by beer producers or wholesalers. The racks in question are intended for in-store display of beer products for sale. Store enhancers are items such as sporting goods, grills, mopeds or electronic appliances added to beer product displays to draw consumers’ attention. Store enhancers do not include images. In some cases, store enhancers would include items offered to consumers as prizes.
In South Carolina, the beer industry is regulated so that producers, wholesalers and retailers each operate on a separate tier in a three-tier system. Code Section 61-4-940 governs the interactions between the different tiers. Producers and wholesalers must not furnish, give, rent, lend, or sell, directly or indirectly, to a retailer any equipment, fixtures, free beer, or service. Likewise, a retailer must not accept such equipment, fixtures, free beer, or service from a producer or wholesaler.
An exception is made for point of sale advertising specialties provided by a wholesaler to a retailer under Code Section 61-4-940(C). According to longstanding Department policy, point of sale advertising specialties must bear advertising matter and must be primarily valuable to the retailer as point of sale advertising. These are items of nominal value and include such things as trays, coasters, plastic cups, etc. Point of sale advertising specialties would not include items of sufficient value to be awarded as prizes.
The Department has determined that racks constitute equipment. Likewise, store enhancers, such as sporting goods, grills, mopeds or electronic appliances, that do not qualify as point of sale advertising specialties of nominal value constitute equipment. A producer or wholesaler must not furnish equipment to a retailer and a retailer must not accept equipment from a producer or wholesaler.
Nothing in this notice restricts images used for signs and other advertising.
This notification can be found on the Department’s website at www.sctax.org under the What’s New section.