Wine Equalisation Tax WET is usually payable if

Wine Equalisation Tax

WET is usually payable if you are registered for GST and you are a: • wine producer • Wine wholesaler or • Wine importer ** Must have a WET account with ATO

WET is usually payable if you are registered for GST and you are a: • wine producer • Wine wholesaler or • Wine importer ** Must have a WET account with ATO

WET is payable on an ASSESSABLE DEALING involving ASSESSABLE WINE.

WET Wine equalisation tax is a tax on the value of wine for consumption within Australia. It applies to : – Wholesales of wine – Some retail sales (eg cellar door) – Imported wine for consumption – Wine applied for a persons own use (eg wine tastings & promotional giveaways)

WET • An ‘assessable dealing’ is an act, event or transaction involving ‘assessable wine’ • ‘Assessable wine’ includes Australian and imported wine and WET applies when they contain more than 1. 15% by volume of ethyl alcohol

WET Examples of ‘wine’ • • Grape wine (including sparkling and fortified) Grape wine products (eg marsala) Fruit wines or vegetable wines Cider, perry, mead and sake

WET does not apply to the following: – – – Beer Spirits Liqueurs Pre-mixed spirits Ready-to-drink designer drinks ATO decision table to determine if WET applies : http: //www. ato. gov. au/businesses/content. aspx? menuid=0&doc=/content/00234529. htm&page=15 &H 15

WET – WET generally applies to the last wholesale of wine. A wholesale is a sale to an entity that intends to re-sell the wine – WET is calculated before the GST is calculated – WET generally is 29% of the wholesales value of the wine. Exceptions – retail sales and applied to persons own use

WET • Exemptions to WET: • The wine will be used as a material in manufacture (eg used in baking a cake) • The wine will be GST-free (eg exported or used in hospitals, religious services or educational courses)

WET • Calculation example for a wholesale: • A winemaker sells grape wine to a wholesaler for $120 a dozen before tax. Sales price WET ($120 x 29%) Sub Total GST ($154. 80 x 10%) Total Wholesale price $120. 00 34. 80 $154. 80 15. 48 $170. 28

WET Calculation of WET for Retail sales 2 methods 1. Half retail price method 2. Average wholesale price method

Example - half retail price method • A winemaker makes a retail sale of grape wine at the cellar door for $140 a dozen, including WET and GST. • Taxable value: $140 x 50% = $70. 00 • WET payable: $70. 00 x 29% = $20. 30

Half retail price method To calculate the notional wholesale selling price (that is, taxable value) on retail sales of wine 1. work out 50% of the retail price (including WET and GST) of those sales and 2. then multiply that amount by 29%.

Wine Producer Rebate • Producers are entitled a rebate of 29% of the wholesale value of eligible domestic sales. • Must be the producer to be eligible • Rebate scheme applies to all products subject to WET • Maximum rebate for a wine producer $500, 000 pa

WET & Rebate • Reporting – BAS • WET – label 1 C • Rebate – label 1 D