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TAS Country : January 17th 2013
uary 18, 2013 11 Tax change will shake the industry from the VINE Graeme Phillips ANOMALIES: Authorities are looking for a new way to tax wine. WITH bold-print headlines shouting ''Cheap wines provoke health fury'' and more and more health and anti-alcohol lobby groups notching up pressure for increased alcohol taxes as a corrective to the economic, social and health costs of problem drinking, 2013 seems destined to be a challenging year for the national wine industry. There are currently eight different levels of alcohol taxes in Australia. Spirit drinkers are taxed at a rate 14 times higher than wine drinkers; beer is taxed at half the rate of spirits; RTDs fall somewhere in between; and wine is taxed ad valorem, that is, on its price. Which means the cheaper the wine, the less it's taxed --- the sort of distorting anomaly that has led to the oft-repeated claim that cask wines, many cleanskins and discounted wines online are cheaper than water. The Government-appointed Aust- ralian National Preventive Health Agen- cy's Issues Paper last year discussed research which ''suggests a direct link between the price of alcohol and rates of misuse'' and for much of 2012 the agency flirted with the idea of a flat tax rate per unit of alcohol, as applied in a number of other countries. In November, the ANPHA finally rejected this and instead called for a volumetric tax. Such a change would have a similar effect to imposing a floor price on alcohol but instead of price increases being pocketed by supermarkets and retailers, it would ''create revenue for the govern- ment'', the report said. In questioning the ANPHA's decision, the Winemakers' Federation of Australia said that since the ANPHA ''could not justify a public interest case that sup- ports using price via minimum pricing to deal with alcohol abuse it is hard to see how another pricing mechanism is going to be any different. ''Issues around harmful and hazardous consumption of alcohol require health, consumer education and cultural change policies, not policies based purely on price''. However, many independent ob- servers consider the WFA's defence as a Canute-like rearguard action at best, and that alcohol tax reform is inevitable. For Tasmania, the elephant in the room during the whole of this debate is what happens to the current 29 per cent Wine Equalisation Tax and the WET rebate provisions which have been an essential life support for most of the state's small producers? At the moment, the tax is rebated up to an amount of $500,000 -- about the equivalent of a sales volume of around $1.7 million. As Sheralee Davies, chief executive of Wine Tasmania says, ''Unlike beer and spirits, you can't just turn wine on and off. Wine is an agricultural product and the hundreds of small producers around the country and in Tasmania generate thousands of regional jobs in rural areas. ''The trouble is, with all the ifs and buts in this debate, we just don't know what the possible reforms look like''. On the face of it, a volumetric tax would suggest premium wines like those from Tasmania would benefit by becom- ing cheaper. ''But it depends on what happens,'' Davies says. ''And until we know, we won't be able to tell just what effect any changes will have on the local industry''. ther researchers examining cherry fruit. ng more summer rainfall Blocking highs are high pressure cells that sit in the Tasman Sea delivering a warm, moist easterly airstream to Tasmania. These blocking systems can create consecutive days of heavy rainfall. CFT projections indicate that as the East Australia Current pushes further south under a changing climate, it is likely to encourage more blocking highs, bringing more rainfall to the East Coast in summer and autumn. There are many other foreseeable effects of climate change on Tasmanian agriculture. A set of recent information sheets produced by TIA and the State Govern- ment are available at the Agricultural Policy section of DPIPWE's website. These provide relevant information about climate change for different agri- cultural sectors and regions. The information sheets can be found at www.dpipwe.tas.gov.au
January 10th 2013
January 24th 2013