Yep, exactly right.
Even though it is designed to be turned into beer it cannot be taxed as such because there is no alcohol content yet.
And same reason as to why you can buy the kits in the supermarket, no alcohol content yet. Which brings me to my question.
Has the alcohol consumption laws been tested by a 16 yr old being found intoxicated on homebrew, something that has no legal age restriction on the purchase age?