Wine equalisation tax
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Wine equalisation tax (WET) is a value based tax which generally applies on the last wholesale sale of wine, usually between the wholesaler and the retailer. If you make wine or import wine for consumption in Australia, or if you sell it wholesale, you normally have to pay WET.
To be involved in the WET system, you need to be registered for goods and services tax (GST) and have a WET business account so you can complete the WET section on your business activity statement (BAS). If you're not registered or required to be registered for GST, you don't have to pay WET other than for imported wine.
WET only applies to certain types of products that have an alcohol content of over 1.15%, specifically grape wine, grape wine products, fruit or vegetable wine, cider, perry, mead and sake. WET applies to both bulk and packaged wine.
WET is generally paid by wine producers, wholesalers or importers, rather than retailers. If you're a retailer, WET is usually already included in the price you pay for these products. In other words, WET forms part of your cost base and is passed on to your customers in the retail price of the product. Transactions that attract WET are known as 'assessable dealings'.
WET is calculated on products sold during assessable dealings at 29% of the wholesale value of the product or an equivalent value when there is no wholesale sale.
Some wine supplies may be exempt from WET. For example, if you intend to make a further wholesale sale of wine, you can legally defer paying WET by quoting your Australian business number (ABN) when you buy the wine. And if your dealing is GST-free, you generally don't have to pay WET.
Under certain circumstances you may be eligible for a credit of WET, for example where you incorrectly calculated WET payable, or to avoid wine being taxed twice. If you're a wine producer, you may be entitled to claim the wine producer rebate.
Once you've calculated the WET you owe, you report and pay WET through your BAS.
Throughout the WET information, we use terms that have a specific meaning under WET legislation, for example 'assessable dealings' and 'applications to own use'. These terms are explained in Terms and definitions.
Refer to Wine equalisation tax essentials for a complete list of documents and services related to this topic.
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