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Industry guidelines: Winemakers
The wine equalisation tax (WET) is a value-based tax paid on certain dealings with wine sold in Australia. These dealings are:
- wholesale sales where WET is paid on the selling price of the wine at the last wholesale sale (excluding WET and goods and services tax)
- untaxed wine sold by retail where WET is charged on a notional wholesale selling price. The rate of the WET is 29% of the wholesale value.
This tax is charged under the Australian tax legislation.
New Zealand producer rebate
The New Zealand producer rebate is a rebate for wine that is:
- produced in New Zealand, and
- subject to dealings in Australia that WET is paid on.
The producer rebate scheme entitles you to a rebate of 29% of your selling price of the wine up to a maximum amount of sales net of any expenses unrelated to the production of the wine in New Zealand. See "Maximum producer rebate" below
Eligibility for the producer rebate
Only producers of wine made in New Zealand and who are approved as a New Zealand participant are eligible for the producer rebate. A producer is defined as an entity that:
- manufactures the wine, or
- supplies another entity with the grapes, other fruit, vegetables or honey the wine is manufactured from (contract winemaking).
Eligibility for the producer rebate scheme for producers of wine in New Zealand has been in place since 1 July 2005.
Approval as a New Zealand participant
Before you can claim the producer rebate, you must be approved as a New Zealand participant. This means you must produce wine in New Zealand which is, or is likely to be, exported to Australia. When you have completed and submitted the application form and received approval, you are eligible to claim for the producer rebate.
Send your completed application form to us at:
P O Box 33150
Maximum producer rebate
The maximum rebate you can claim in a financial year (1 July to 30 June) is AU$500,000 which is around AU$1.7m worth of sales.
If you are an associated producer of one or more other producers (they may be Australian producers and/or New Zealand producers) the maximum rebate you are entitled to as a group is AU$500,000.
You must submit claims within four years of the end of each financial year ending 30 June to be accepted for payment.
This maximum rebate limit has applied from the financial year ended 30 June 2007 but see the updated announcements below.
Proposals following release of the WET Rebate Changes fact sheet 2/12/2016
Effective from 1 July 2018 plus new eligibility rules
Go to The Australian Treasury website for the "Wine equalisation tax rebate: tightened eligibility criteria" consultation paper.
Producer rebate income for New Zealand income tax purposes
The producer rebate is considered to be income for New Zealand income tax purposes and must be returned in the income year in which the amount is received.
|On 24 July 2013, you receive AU$290,000 WET rebate. This amount (converted into New Zealand dollars) must be returned as taxable income in your income tax return from 1 April 2013 to 31 March 2014.|
Currency for the transactions
All currency must be converted to Australian dollars. Selling prices and expenses used to calculate the producer rebate that are expressed in $NZ must be converted to Australian currency.
Australia have specific rules which tell you which exchange rate to use to convert these amounts. Generally, these require amounts to be converted at the exchange rate prevailing at the time of a transaction, or at an average rate.
You have three options for conversion:
- Reserve Bank of Australia (RBA) rate
- agreed rate, and
- average yearly Reserve Bank of New Zealand (RBNZ) rate.
For more information go "Converting foreign currency" on the Australian Taxation Office website.
If you require a foreign exchange rate for a currency not listed in the schedule, please use any reasonable externally sourced exchange rate for that currency.
Find out more about WET
Go to the Australian Taxation Office website for more information about the WET producer rebate for New Zealand wine producers such as:
- what is covered by the producer rebate
- what is not covered by the producer rebate
- which dealings with wine qualify for the producer rebate
- which dealings with wine do not qualify for the producer rebate
- calculating the producer rebate, and
- claiming the producer rebate
You can either:
- phone us on 0800 377 774
- send us a fax on (09) 984 3110
- email us at email@example.com, or
- write to us at WET Rebate, P O Box 33150, Takapuna 0740.