Budget brings changes for wine industry

Last week’s Federal Budget has delivered long overdue reforms for the wine industry.

These include wine equalisation tax (WET) changes which, according to the Budget will save $300 million over four years, channelling $50 million to the Australian Grape and Wine Authority to promote Australian wine overseas, and wine tourism at home.

Wine makers until these changes able to claim back as much as $500,000,the vintners have paid out in the WET.

That cap will be lowered to $350,000 from July 1 next year.

It will be lowered again to $290,000 from July 1, 2018.

There will be no rebate for bulk and unbranded wine.

The Budget has flagged “integrity measures” to stop people claiming the rebate more than once a year. It is also looking to "help deter artificial business structuring".

The Budget will also tighten eligibility criteria for accessing the WET rebate from July 1, 2019.

The government says the final details of who will be eligible for a rebate , including the definition of a 'winery', "will be resolved through further consultation".

However, Assistant Treasurer Kelly O'Dwyer and Assistant Agriculture Minister Anne Ruston issued a joint statement noting that to be eligible, "a wine producer must own a winery or have a long term lease over a winery and sell packaged, branded wine domestically".

In other changes, Australian distillers and "non-traditional" cider makers will able to claim a rebate of their own from next year.

Eligible breweries will be able to claim a refund of up to 60 per cent of excise paid, up to $30,000 per financial year.

The Government is also extending the excise refund scheme to domestic producers of whisky, vodka, gin, liqueur and producers of "low strength fermented beverages such as non-traditional cider". That comes into effect on 1 July 2017.

Alcopop producers who buy spirits to mix with soda and flavour, New Zealand distillers and non-traditional cider makers will not be eligible for the excise rebate.

by:  Leon Gettler