Hon Dr Michael Cullen
Minister of Finance
MEDIA STATEMENT
SOP will assist NZ wine industry
New Zealand's wine producers who export to Australia will have access to Australia's wine equalisation tax rebate under a Supplementary Order Paper promoted today by Finance Minister Michael Cullen.
Dr Cullen is seeking leave for the SOP to the Taxation (Annual Rates and Urgent Measures) Bill to be referred to the select committee considering the bill.
"The change is part of a joint trans-Tasman legislative effort that will involve both Australia and New Zealand in the administration of the rebate to New Zealand wine producers who export to Australia," Dr Cullen said.
"Australia will assess, pay and generally administer the rebate, while New Zealand will be involved in the registration and application processes and, if necessary, carry out any domestic prosecutions for providing false information.
"Australia introduced the rebate last year to compensate wine producers in part for the 29 per cent wine equalisation tax charged on the wholesale price of wine sold on the Australian market. Wine producers are eligible for a rebate of up to A$290,000 a year.
"I am very pleased that Australia is extending the rebate to New Zealand wine producers who export to Australia, a move that followed strong representation by the New Zealand government and is in the spirit of our Closer Economic Relations agreement.
"Because the rebate is, in effect, a subsidy to enable our producers to compete in the Australian market, it will be subject to New Zealand income tax, as other government grants to business are. Australia also taxes such rebates.
"Once enacted, the rebate will apply from 1 July 2005, with applications expected to be received in mid-2006," Dr Cullen said.
Contact: Patricia Herbert, press secretary, 04 471 9412 or 021 270 9013
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