Concern over wine tax delay

Federal Agriculture and Water Resources Assistant Minister Anne Ruston made the promise at an irrigation stakeholder meeting in Renmark last Thursday.

"We have come a long way in the process ... and I think we will have a very positive announcement for industry before the end of the year," Ms Ruston said.

The comment came after Riverland Wine executive officer Chris Byrne questioned the status of the reform to Federal Ag and Water Resources Minister Barnaby Joyce at the meeting.

"Winegrapes are the number one wealth generator in this region and have been for a long time," Mr Byrne said.

"But it is starting to lose its pre-eminence."

Mr Byrne believed a reform of the WET rebate would bring relief and strength to the local industry.

"We are the largest wine-producing region in the country," he said.

"Yet only about 3pc of our wine producers are allegedly getting some benefit from the WET rebate scheme.

"We need to give some greater hope to the other 97pc that we are on our way back to recovery.

"We have been distracted by water issues, which is fair enough, but this issue has strong support from all industry bodies.

"Anything the Federal Government can do to accelerate the signing off and implementation of the reform would be greatly appreciated by the largest number of growers and winemakers in the country."

Mr Joyce said there was delay in the reform as the WET was moved from the Ag White Paper to the Taxation White Paper, and finding unified solutions were difficult.

While Ms Ruston said there had been some "technical issues" surrounding recommended changes, such as the review of the New Zealand rebate, which falls under a free trade agreement.

"There are ways and means by changing the criteria for their eligibility that we can either reduce or make negligible," she said.

"We are just trying to work through what that is.

"We know industry wants distortion taken out of the marketplace.

"However the last thing the government want to do is to set up a more complicated system that just puts another distortion in the marketplace to try and fix the existing distortion, because more loopholes will be found."

A reform Mr Byrne suggested was the withdrawal of the rebate on bulk unbranded products, which could be rolled out over four years.

"We could use the savings to boost Australia's marketing potential," he said.

"We need more marketing dollars to reassert ourselves as Wine Australia and become more globally acknowledged.

"Removing the rebate from bulk unbranded products is a no-brainer."

The Federal Government released the WET Rebate Discussion Paper in August, aimed at pruning market distorting wine-industry subsidies, while a Consultative Group comprising senior wine industry members was also established as part of the taxation reform process.

The group, chaired by Senior Treasury Official Russell Campbell, will consider submissions and feedback on the discussion paper and provide advice to the government later this year on options for reforming the system.

Submissions to the discussion paper closed on September 11.