Washington — The Supreme Court said Monday that it will examine whether a federal law dating back nearly 160 years can constitutionally prohibit people from distilling liquor in their homes.
The case, Department of Justice v. McNutt, is expected to be argued next year. The justices could issue a ruling by late June or early July.
For more than a century, Congress has restricted where distilled spirits may be produced as a way to combat tax evasion. The 1868 law at the center of the case says that a “person may not produce distilled spirits at home for personal use.” Anyone who uses or possesses a still or similar equipment in a “dwelling house,” shed, yard or other enclosed area can face criminal charges.
Those convicted may be fined and sentenced to as many as five years in prison. Their homes and the property inside them may also be seized by the government.
Congress adopted the restrictions after concluding that commercial distillers were widely evading federal taxes. In 1867, the tax on spirits stood at $2 a gallon—more than the product’s market value—and distillers reportedly found it cheaper to bribe revenue officers than pay the levy, according to a House report. Lawmakers estimated that “at least seven-eights” of all spirits were going untaxed.
The legislation that eventually barred home distilling lowered the tax rate and required the duty to be paid before spirits could leave a warehouse. It included no exemption for liquor produced solely for personal or family consumption.
The challenge to the longstanding prohibition was filed by the Hobby Distillers Association and one of its members, who wants to make spirits at home. They argued that the ban goes beyond Congress’ enumerated powers, including its authority to impose taxes. A federal district court agreed and declared the prohibition unconstitutional.
The 19th-century location rules, the district court concluded, “criminalize conduct of persons not subject to the tax” and do not “touch the product to be taxed.”
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The U.S. Court of Appeals for the 5th Circuit later upheld most of that ruling. It found that the restrictions were not “plainly adapted” to advancing the government’s taxing power because preventing people from making spirits at home also eliminates products that could otherwise be taxed.
Allowing the prohibition to stand, the 5th Circuit warned, could permit Congress to “criminalize nearly any at-home conduct only because it has the possibility of concealing taxable activity.”
Solicitor General D. John Sauer urged the Supreme Court to hear the case, calling the lower court’s decision to invalidate the ban “erroneous.”
In the government’s appeal, Sauer wrote that Congress targeted home distilling because operations based in a dwelling or an attached structure are easier to conceal and harder for officials to inspect, allowing producers to avoid the required tax.
The prospective distillers also asked the Supreme Court to resolve the dispute. Their attorneys maintain that the ban exceeds Congress’ authority under the Constitution’s Taxation Clause and Necessary and Proper Clause.
They argued in court filings that the government’s theory has no clear stopping point, warning that “there is no limit to the government’s claim of power to criminalize local conduct that might conceal taxable activity.”