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Taxing talk for vignerons

CATHY McGowan (MHR, Indi) and Liberal candidate Sophie Mirabella say they will take North East vignerons’ reactions to a Senate committee’s recommendations to change the nation’s wine tax system to government.

The Senate’s rural and regional affairs and transport references committee on Friday released a report in which it argued that the wine equalisation tax (WET) rebate, introduced 17 years ago to support regional producers, be phased out over five years.

It recommended that the savings be put towards “structural adjustment” in the wine business, including what the committee described as an annual grant to “genuine cellar door operators” to support wine sales.

But local vignerons’ associations believe that the federal government would risk “throwing the baby out with the bath-water” if it adopted the recommendations.

The WET is added at a rate of 29 per cent to the wholesale price of wine and before the standard 10 per cent goods and services tax is applied.

Most vignerons who make wine from their own grapes, or producers who have their grapes vinified by a contract winemaker, are then able to claim a rebate of 29 per cent of wholesale price of wine sold to retailers and at cellar door, or used, for example, as tasting stock.

An individual claim is capped at a maximum of $500,000 per year.

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