Industry has challenges

AUSTRALIA’S wine industry has many challenges, but a new report into growing the wine sector’s profitability can help, according to Brown Brothers chief executive officer Roland Wahlquist.

The Winemakers’ Federation of Australia (WFA) recently launched its Actions for Industry Profitability 2014-16 report, outlining over 40 specific actions in key issue areas, such as capturing the demand for Australian wine internationally, and tightening eligibility of the Wine Equalisation Tax (WET).

Mr Wahlquist, who oversees the Milawa-based winery company – one of the largest wine producers in Australia – said a change in eligibility criteria of the WET rebate will make sure it is only given to genuine wineries, potentially saving the industry millions and levelling the competition’s playing field.

Mr Wahlquist said the WET rebate was brought in to keep taxation at the same level prior to the GST being introduced.

He said each business could claim up to $500,000 on their first $1.6 million in sales which was important to the viability of regional producers.

“However, some businesses have been claiming the rebate with minimal investment,” he said.

“Businesses have been buying grapes from someone else, getting the wine made offsite, and then selling it while claiming the WET rebate.

“This is then built into their pricing so wines are sold at a low price, making it hard for producers to sell at a competitive price point.”

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