KY Bourbon 2021 Economic Report: The Good and The Challenges


The Bourbon State’s signature industry is riding high as the proof of a George T. Stagg bottle. Translation – it’s doing well, very well.

Today in the capital city of Frankfort, KY – Governor Andy Beshear, members of Senate and numerous dignitaries gathered to unveil the findings of an economic report detailing the growth, surrounding impact, and the facing challenges of the Kentucky Bourbon Industry. The biennial report (sixth since 2009) was generated by economist Dr. Paul Coomes and funded by the industry trade group Kentucky Distillers Association (KDA).

We’re a fan of bullet points. Here’s the breakdown of “the good” (tons of that – yay) vs. the “challenges” (not nearly as – yay). Lastly, improvements made in KY laws to make distilling and related tourism more prosperous in recent years. Cheers!


  • $9 billion in economic output every year
  • More than 22,500 jobs, up 83% in last 20 years 
  • $1.23 billion in payroll, up 250% in last 20 years 
  • Average salary of $101,567 – the first time that amount has exceeded $100,000
  • KDA distillers bought 17 million bushels of corn in 2020, with 75% coming from Kentucky farmers
    • This figure excludes data from non-KDA distillery members
  • Corn production has tripled in many Kentucky counties where distillers are located
  • All-time record of 10.3 million aging barrels of Bourbon, the first time over 10 million
  • Bourbon production – number of barrels filled each year – is up 435% since 1999
  • Kentucky distillers filled a record 2.4 million barrels in 2020
  • $5.2 billion in capital projects completed or planned by 2025, including more than $100 million to build or expand Kentucky Bourbon Trail® experiences
  • Investments between 2021-2025 will create 4,565 new jobs, $258 million in payroll and $29 million in tax revenue
  • Distilling has the highest job spin-off factor among top 20 Kentucky manufacturers by employees; for every distilling job, three more are created
  • Value of distillers’ real and tangible property has quadrupled in last 12 years to $1.49 billion
  • The KDA’s Kentucky Bourbon Trail® and Kentucky Bourbon Trail Craft Tour® experiences continue their rapid rebound from COVID and closures, up 160% in total attendance from last year and just down slightly from pre-pandemic record in 2019. 
  • Distilling production and consumption generates $286 million in local and state tax revenue annually. That’s $179 million more tax revenue a year versus 12 years ago.


  • Kentucky continues to tax distilling higher than all other large industries in the Commonwealth. 
  • Kentucky has the fifth-highest Bourbon and spirits tax rate in the country, and the state’s distillers by far pay more in federal alcohol tax – $1.8 billion – than any other state
    • Barrels are taxed as they age in KY
    • The only place IN THE WORLD that does this
    • Even with 2014 Barrel Credit (see below), the major uptick in recent barrel filling is outpacing the credits that can be used, especially by the larger distilleries who may see only 30% credit usage.
    • 2,200 distilleries nationwide
    • KY’s distillery presence nationwide: 24% down to 6%
    • KY’s percentage of distillery jobs nationwide: 43% down to 30%
    • 10 states have more licensed distilleries than KY


Gratitude was given to the following members of senate for advances in booze related legislation benefiting the industry. This included:

  • 2014 Bourbon Barrel Tax Credit, Senate President Robert Stivers: Offset the discriminatory tax that distillers pay on aging barrels. KDA President Eric Gregory said the credit stimulated barrel production leading to now-record inventories.  
  • 2016 Senate Bill 11, Senate Licensing & Occupations Chairman John Schickel: Authorized cocktail sales at distilleries thus leading to a surge of robust, immersive tourism experiences.  
  • 2017 HB 100 Vintage Spirit, Rep. Chad McCoy: Allowing distilled spirit license holders to buy “vintage spirits” from non-license holders and then sell it by the glass or bottle.
  • 2020 Direct-To-Consumer Shipping, Senate Majority Leader Damon Thayer and Senate Democratic Leader Morgan McGarvey: Landmark legislation making KY a model for DTC spirits shipping around the USA.