Peter Costello

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Wine Industry Assistance



The Government has tonight announced significant changes to the current wine tax arrangements which will provide over $300million in tax relief to the Australian wine industry over the next four years.

The Government will rebate $290,000 of wine equalisation tax (WET) to every wine producer per annum. This measure will apply from 1October 2004 and will be pro-rated for the 2004-05 financial year. The effect of this decision is to exempt $1million of each producer’s domestic wholesale wine sales from the WET on an annual basis.

The measure will provide each producer with relief from the WET of up to $290,000 each year, compared with a maximum rebate of $42,000 under the current Australian Government Cellar Door Rebate scheme. The producer rebate will replace the existing Cellar Door Rebate scheme and accelerated depreciation provisions for grapevine plantings.

The changes will reduce compliance costs for all wine producers, with around 90percent of wine producers receiving a rebate that will entirely offset their WET liability. The changes will provide significant benefits to the wine industry, with around 85percent of the benefits being received by small wine producers in rural and regional Australia.

As a result of this effective WET exemption for 90per cent of Australian wine producers, the States will be able to discontinue their cellar door rebate schemes. Accordingly, the Australian Government will seek to recover the savings to State governments.

Legislation to give effect to this announcement will be introduced as soon as practicable.

Contact: David Alexander
02 6277 7340

11 May 2004

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