LEGISLATION to reform the hotly-debated Wine Equalisation Tax rebate has been introduced to parliament by the Coalition government today.
The Treasury Laws Amendment (2017 Measures No. 4) Bill 2017 will tighten eligibility for the WET rebate, meaning wine producers will be required to own at least 85 per cent of the grapes used to make the wine throughout the winemaking process.
This will stop the rebate being claimed multiple times on the same wine through the production chain where it is subject to blending or further manufacture and then on sold.
The rebate cap will also be reduced from $500,000 to $350,000.
“The government has worked closely with the wine industry on the implementation details of these reforms to ensure the rebate is targeted to wine producers who build brands, invest in regional communities and create local jobs,” Revenue and Financial Services Minister Kelly O’Dwyer said.
“The changes are a part of the continuing efforts of the government to strengthen the integrity of Australia’s tax system.”
“The reforms to the rebate form an important part of the Government’s efforts to support a strong and sustainable Australian wine industry,”
Assistant Minister for Agriculture and Water Resources Anne Ruston said the reforms reflected the “strong collaboration between government and industry in working through the issues and identifying the solutions”.
“I commend the leadership of the Australian wine industry on their advocacy, and willingness to debate and negotiate in good faith with the government,” Ms Ruston said.
Transitional arrangements will apply to provide the industry with sufficient time to adjust to the changes before they begin in July next year.
Wine will need to be packaged in a container not exceeding five litres (or 51 litres for cider and perry) and branded with a trademark to remove eligibility from bulk and unbranded wine.
The government says rebate claims will be better linked to the payment of the WET to prevent schemes where the rebate is being claimed on wine sold into the export market.
The government is also providing $50 million across four years to the Australian Grape and Wine Authority to promote Australian wine overseas. On the domestic front, a new Wine Tourism and Cellar Door grant program will provide wine producers who have exceeded the rebate cap up to an additional $100,000 per financial year on their cellar door sales.
