Now the GST is a reality again, it’s time for the organisations which claim to represent the different segments of the wine industry to earn their salt by ensuring that any Wine Equalisation Tax (WET) is as low as possible. Unless altered, a WET would represent a 29% tax on top of the 10% GST, despite several wine industry submissions to reduce it to 24.5%. According to the University of Adelaide’s Centre for International Economic Studies (CIES), the 29% WET actually raises the equivalent tax rate under the present scheme from 41% to 46% as a wholesale sales tax (WST). When the GST is applied to corkage charges in restaurants, the 29% WET become equivalent to a WST of 52%, says the CIES, increasing total wine tax revenue by over 20%. The CIES says a revenue-neutral WET would be between 20-22%. The wine industries of Australia and New Zealand are already the two most highly taxed in the world.
