Cider Australia has called on the Federal Government to refocus its Wine Equalisation Tax. In Australia, the WET tax is designed to help small local producers compete against the big players in the market. This is a tax of 29% of the wholesale value of wine. Currently Aussie wine, cider and perry producers are eligible for a rebate of up to AU$500,000 on the tax. For the big players this is “nice to have”. Not having it isn’t going to kill them. For the smaller players with a handful of staff this is the only way they can compete.
As it stands all Cider makers (excluding fruit ciders) are eligible. The Australian Government is trying to reduce the cost of the rebate to the Federal Budget. So Cider Australia is proposing to exclude cider makers who use imported juice or concentrate. The theory is if you want the rebate you must buy your juice from Australian growers. This will ensure the tax dollars from the rebate say in the Aussie economy. As the biggest players take the most rebate while using imported concentrate this adjustment would be a big saving. Craft Cider producers do not claim anywhere near the maximum $500,000 as they just don’t sell the volume.
Full Cider Australia press release after the break
Cider Australia WET Rebate Press Release
Industry body Cider Australia has called on the Federal Government to refocus its Wine Equalisation Tax rebate so eligibility is limited to cider made from 100% Australian apple and pear juice.
The national association of cider and perry producers today released a new position statement proposing a simple and effective eligibility test that ensures the rebate directly benefits agricultural communities while also cutting Government expenditure.
Cider Australia president Sam Reid said, “The purpose of the WET rebate is to support rural and regional producers, so it makes sense that the rebate should only be available to producers that use Australian juice”.
“There is a huge difference in the economic activity generated by the production of Australian craft cider and perry using 100% Australian grown fruit compared to ciders made from imported juice concentrate, particularly in regional Australia”.
“Australian Craft cider may only count for between 5-10% of the cider produced in Australia, with the rest made from cheap imported juice concentrate, but the craft cider industry is punching above its weight when it comes to supporting our growers”, Mr Reid noted.
“It’s easy to see the positive impacts of the craft cider industry on prices, eating fruit quality and local industry diversity, but its production is also driving growth in tourism, regional employment and a host of other ventures”, said Mr Reid.
The Government will soon consult on the implementation of the WET rebate reform package announced in the May Federal Budget.
“We are concerned that attempts to limit eligibility for the rebate could wipe out many of our smaller producers and stifle innovation and growth in the cider category”, said Mr Reid.
“Cider Australia does not support announced cuts in the annual rebate cap for producers that use Australian grown fruit, particularly during the embryonic stage of industry development”.
“It’s time to level the playing field so that craft cider producers have some chance of competing with producers that use significant imported ingredients”, Mr Reid said.