In this title the following words have the meanings indicated. “Alcoholic beverage” means a spirituous, vinous, malt, or fermented liquor, liquid, or compound that: is fit for beverage purposes; and contains one–half of 1% or more of alcohol by volume. “Alcoholic beverage” includes: beer; distilled spirits; and wine. “Alcoholic beverage license” means an alcoholic beverage license or permit issued under the Alcoholic Beverages and Cannabis Article. “Beer” means a brewed alcoholic beverage. “Beer” includes: ale; porter; stout; hard cider, as defined in § 1–101(c) of the Alcoholic Beverages and Cannabis Article; and alcoholic beverages that contain: 6% or less alcohol by volume, derived primarily from the fermentation of grain, with not more than 49% of the beverage’s overall alcohol content by volume obtained from flavors and other added nonbeverage ingredients containing alcohol; or more than 6% alcohol by volume, derived primarily from the fermentation of grain, with not more than 1.5% of the beverage’s overall alcohol content by volume obtained from flavors and other added nonbeverage ingredients containing alcohol. “Consumer” means a person who buys, possesses, or transports an alcoholic beverage for a purpose other than selling the alcoholic beverage. “Direct wine shipper” has the meaning stated in § 2–142 of the Alcoholic Beverages and Cannabis Article. “Distilled spirits” means a distilled alcoholic beverage. “Distilled spirits” includes: alcohol; brandy; cordials; gin; liqueur; rum; vodka; whiskey; and solutions or mixtures of distilled spirits except fortified wines. “Manufacturer” means a person who operates within the State a place of business for blending, bottling, brewing, distilling, fermenting, or rectifying an alcoholic beverage. “Nonresident dealer” means a person who is required to obtain a nonresident dealer’s permit under § 2–124 of the Alcoholic Beverages and Cannabis Article. “Person” includes: this State or a political subdivision, unit, or instrumentality of this State; another state or a political subdivision, unit, or instrumentality of that state; and a unit or instrumentality of a political subdivision of this State or of another state. “Resident dealer” means a person who is required to obtain a resident dealer’s permit under § 2–125 of the Alcoholic Beverages and Cannabis Article. “Retail dealer” means a person who buys an alcoholic beverage for sale to a consumer. “Retail dealer” includes a county department of liquor control, a liquor control board, or the Alcohol Beverage Services for Montgomery County that operates a dispensary. “Wholesaler” means a person who buys or imports an alcoholic beverage for sale to another person for resale. “Wholesaler” includes a county department of liquor control, a liquor control board, or the Alcohol Beverage Services for Montgomery County that operates a wholesale dispensary. “Wine” means a fermented alcoholic beverage. “Wine” includes: carbonated, flavored, imitation, sparkling, or still wine; champagne; cider; fortified wine; perry; sake; and vermouth.

Except as provided in § 5-104 of this subtitle, a tax is imposed on any alcoholic beverage in the State. A tax is imposed on each person who sells or consigns an alcoholic beverage in the State from a jurisdiction outside the State, if the Comptroller finds that, in connection with the solicitation, sale, and distribution of alcoholic beverages, the jurisdiction: requires a tax, assessment, or charge that is greater for alcoholic beverages consigned from a Maryland licensee or permit holder than the amount required for alcoholic beverages consigned from a licensee or permit holder in another jurisdiction; and discriminates in fact against the licensee or permit holder of the State. A county, municipal corporation, special taxing district, or other political subdivision of the State may not impose a tax on any alcoholic beverage. The Comptroller may not impose the tax under subsection (b) of this section on a person who has distillery plants in this and another state.

A rebuttable presumption exists that any alcoholic beverage in the State is subject to the alcoholic beverage tax. An alcoholic beverage on which the alcoholic beverage tax is not paid is a contraband alcoholic beverage if it is delivered, possessed, sold, or transported in the State in a manner that is not authorized: under this title; or under the Alcoholic Beverages Article. The person who possesses an alcoholic beverage has the burden of proving that the alcoholic beverage is not subject to the alcoholic beverage tax.

The alcoholic beverage tax does not apply to an alcoholic beverage that is: brought into the State by a person in accordance with: an import–export permit under § 2–123(b) of the Alcoholic Beverages and Cannabis Article; a nonbeverage permit under § 2–164 of the Alcoholic Beverages and Cannabis Article; or a nonresident storage permit under § 2–115 of the Alcoholic Beverages and Cannabis Article; sold or delivered by a person who holds a Class E, F, or G alcoholic beverage license, while the licensee is operating an aircraft, vessel, or train outside boundaries of the State, including airspace and waterways; beer or wine that is family–produced and is brought into, possessed, or transported in the State by an individual who is a member of that family if: the individual is at least 21 years of age; and the beer or wine is for personal use or for entry in a licensed national family beer and wine exhibition; or brought into the State by a person for storage pending shipment outside of the State, if the alcoholic beverage: is not held for sale, consignment, or delivery in the State; is under a customs bond; and is stored in a public bonded warehouse. The exemption under paragraph (1)(ii) of this subsection does not apply to an alcoholic beverage sold or delivered by a person who holds a Class E, F, or G alcoholic beverage license while the licensee is operating an aircraft, vessel, or train within the boundaries of the State, including airspace and waterways. The alcoholic beverage tax does not apply to: an alcoholic beverage bought by a person whom a proper authority of the United States allows to buy alcoholic beverages for sale and use on a federal reservation in the State where the person is assigned; wine bought and used for sacramental purposes by a religious organization affiliated with and recognized by a generally acknowledged religious faith; or wine or distilled spirits bought and used for medicinal purposes by a bona fide hospital. A person under paragraph (1) of this subsection who pays the alcoholic beverage tax may obtain the exemption by filing a claim for refund with the Comptroller. The alcoholic beverage tax does not apply to an alcoholic beverage that a consumer at least 21 years of age brings into the State for personal use: if the quantity brought from within the continental United States does not exceed: at any one time, one quart; in 1 calendar month, two quarts; and a total of 1 gallon in the consumer’s possession at any one time; if the quantity brought from American Samoa, Guam, or the Virgin Islands of the United States does not exceed 1 gallon; or if the total quantity brought from any other place outside the continental United States does not exceed 1 gallon, the 1st quart of that gallon. A consumer under paragraph (1)(iii) of this subsection may obtain the exemption for the 1st quart by: filing an application with the Comptroller on the form the Comptroller requires; and paying the alcoholic beverage tax on the quantity of alcoholic beverages that exceeds 1 quart.

Except as provided in subsection (d) of this section, the alcoholic beverage tax rate for distilled spirits is: $1.50 for each gallon or 39.63 cents for each liter; and if distilled spirits contain a percentage of alcohol greater than 100 proof, an additional tax, for each 1 proof over 100 proof, of 1.5 cents for each gallon or 0.3963 cents for each liter. Except as provided in subsection (d) of this section, the alcoholic beverage tax rate for wine is 40 cents for each gallon or 10.57 cents for each liter. Except as provided in subsection (d) of this section, the alcoholic beverage tax rate on beer and mead is 9 cents for each gallon or 2.3778 cents for each liter. The tax imposed under § 5–102(b) of this subtitle shall equal the amount that the discriminating jurisdiction charges a Maryland licensee or permit holder.