3 Jun 2011

Excise change 'misses core issue'

12:02 pm on 3 June 2011

A leading wine industry figure says the change to the way excise tax is collected doesn't address the core issue.

From 1 July, smaller wineries will move from paying their tax every month to every six months or once a year, helping to reduce compliance costs and bringing payments in line with when they receive money.

John Buck from Te Mata Estate in Havelock North, who chaired the Wine Institute from 1991-1996, acknowledges the changes will be of some help to small wineries with cash flow problems.

However he says the issue of whether the tax is fair on land-based production with seasonal variations has not been addressed.

New Zealand Winegrowers says the Government's decision to alter the way excise tax is collected from wine companies, is a positive move.

Winegrowers chef executive Philip Gregan says the regulatory change will have a significant cash flow benefit for affected wineries, and better align excise payments with their incomes.

Under the changes, only companies with a tax bill of $100,000 will be required to pay monthly. About half of the country's 700 wineries were expected to benefit from the move.