• Clear or characterless grape-based products

    Wine and grape-based beverages that are processed or treated so that they do not resemble wine are not subject to WET. However, these products may be subject to excise tax.

    Where the characteristics of grapes or fermented grapes are removed, the resulting product is not a product of the fermentation of fresh grapes or products derived solely from fresh grapes.

    These products are often fortified and packaged to compete with, or be a substitute for, spirit-based products.

    If you make these products, or have them made on your behalf, you should treat them as excisable.

    See also:

    Example 1

    Wine Co purchases bulk non-varietal white wine. Wine Co subjects the wine to carbon filtration to achieve a clear, colourless liquid. They apply for duty-free spirit to fortify the beverage to 22% alcohol by volume. Wine Co wishes to package and sell this product under its own label.

    The heavily filtered product is no longer a product of fermentation of fresh grapes or a product derived solely from fresh grapes. It is commercially distinct from the original wine. It is not wine and will be subject to excise.

    End of example

     

    Example 2

    Wine Co wishes to purchase leftover permeate from another company’s winemaking activities. The permeate is a clear product containing 10% alcohol by volume. Wine Co wishes to add colours and flavours to the permeate and sell it as a beverage.

    The permeate in these circumstances is not a product of fermentation of fresh grapes or products derived solely from fresh grapes. It is a product of the reverse osmosis process that creates it. Permeate alone is therefore not wine. The product will be subject to excise.

    End of example

     

    Example 3

    Wine Co purchases low sugar juice, which is a by-product of a manufacturing process used to make grape concentrate. It is a clear, colourless product. Wine Co wishes to allow fermentation to occur in this product so that it contains over 1.15% alcohol by volume. Wine Co then wishes to fortify the beverage, and add colours and flavours.

    This product is not wine as it is not the product of fermentation of fresh grapes or derived solely from fresh grapes. The product will be subject to excise.

    End of example
      Last modified: 13 Feb 2017QC 46919