Welcome
No conflicts of interest were declared and attendees were reminded to declare any conflicts that may arise during discussions.
Integrity declarations have been completed by all non-government attendees. Attendees were asked to highlight any issues considered sensitive or confidential during discussions.
Reflections of 2024–25 / Focus for 2025–26
The wine equalisation tax (WET) program is operating as intended. During 2023–24, just over $1 billion was collected, net of collections and producer rebate and credits claimed. This was consistent with the previous year. The most recent WET tax gap estimate is 3.3% for 2021–22, meaning approximately 97% was collected. The 2022–23 tax gap will be published in October. During 2024–25, the ATO continued to focus on providing ‘help and educate’ supports to new entrants to better understand their obligations when entering the WET system. The majority of WET paid comes from privately owned and wealthy groups and public and multinational businesses . While many clients are in the small business group, most payments from that group are balanced out by producer rebate claims.
Compliance focus areas for 2024–25 were around broader compliance, including the potential for business activity statement (BAS) fraud. Although this is not a current issue of concern, it was noted that there are good detection processes in place. The ‘new to WET’ program of educating new entrants and the excise client manager (ECM) program continue to provide a level of compliance assurance. In 2024–25, the ECM program was extended to a second group, or Tier 2, of significant contributors to the WET regime, to provide a direct Australian Taxation Office (ATO) point of contact.
Targeted compliance work was undertaken using data-based insights to identify unusual trends in claims as well as continued testing to ascertain whether behaviours that resulted in 2018 amendments are re-emerging, particularly around schemes or arrangements designed to incorrectly maximise or extend producer rebate entitlements. A similar approach will be taken in 2025–26. The ATO would be looking to extend the data-based insights work to obtain a better understanding of imported products, with a particular interest in those quoting and testing how product is dealt with once entered into ATO systems. Improved data matching will be used to focus on areas of most concern.
Cider Australia referred to the 2025 Australian Grape and Wine review of WET and a recommendation to review the WET and the WET rebate to ensure policy objectives are still being met without unintentionally providing advantages for vertically integrated grape producers, winemakers and wine retailers. The ATO advised that while we are aware of some elements of industry being vertically integrated, the WET Act provided provisions to manage those circumstances. We are not aware of any specific concerns in that area. Treasury advised that the report and any subsequent activity is being managed by the Department of Agriculture, Fisheries and Forestry. Next steps would be for government consideration.
The alcohol excise system is considered to be operating largely as intended, there continues to be concerns around illicit alcohol activities/behaviours. In 2023–24 alcohol excise collections were approximately $7.5 billion, with the 2021–22 tax gap estimated at 9%, or approximately $800 million.
The ATO has now finalised 2 significant bodies of work; the digitisation of excise returns and deregulation/streamlining measures. Benefits of those changes are becoming evident, including no need for renewal of excise licences. It was noted that automated reminders and better online visibility of taxpayer accounts has led to an improvement in on-time lodgment.
Focus areas for 2025–26 will be around ensuring that those excise payers who choose to comply are supported and a tailored approach taken for those who are accidentally or deliberately not complying. The ‘new to excise’ program will continue to help those starting in the industry. Industry feedback is always welcomed in terms of support for new excise payers. The ATO will be looking at introducing online modules for brewers and distillers as part of the small business online essentials program. ECMs will continue to provide tailored support to Tier 1 and Tier 2 companies as well as obtaining a greater level of assurance through engagement with those entities.
Both industry and the ATO have identified concerns relating to claims for the alcohol manufacturer’s remission (AMR) scheme. The ATO is carrying out further analysis and improving data matching resulting in targeted action being taken in 2025–26, particularly around testing AMR claims in relation to shared premises and ‘legally and economically independent’ criteria. In response to advice from industry, the ATO will be checking to ensure that the requisite distilling is occurring, and other eligibility criteria are met, when the remission is claimed. The ATO is aware of ‘cap shopping’ by some operators to make use of remaining AMR caps. Work will be carried out to better understand these arrangements and ensure that claims are appropriate.
In line with other industries, the ATO has noted an increase in the number of insolvencies in the alcohol industry. We continue to engage with liquidators to ensure they are aware of and understand obligations associated with excise licences for those businesses, for example stock on hand. Although taxpayers may undertake legitimate restructuring and insolvency options, members were reminded that excise licensing decisions are independent of those processes and may be impacted. We encourage businesses encountering difficulty to engage with us early to work through compliance obligations.
In addition to internal controls, the ATO is keen to hear from industry about examples of concerning or illicit behaviours. Australian Distillers’ Association (ADA) flagged interest in further discussions around entities claiming both the WET rebate and AMR under the excise provisions, an online education program and utilisation of the AMR cap.
Members noted the existence of spirits being sold at a cost which would not appear to include excise duty. It was also noted that the intent of the AMR was to support small businesses to have extra money to reinvest in business, however this may be being used to offset sales prices. Industry members are encouraged to raise issues with government if they believe policy settings are not achieving the desired outcomes.
The ADA queried government’s response to the recent Parliamentary Inquiry into the food and beverage industry. While Treasury are aware of the inquiry and subsequent report, policy changes are a matter for government consideration.
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Action item |
Claiming both WET and AMR rebate |
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Responsibility |
Group Chair |
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Description |
ATO to follow up discussions with ADA regarding entities claiming both the WET rebate and AMR under the excise provisions, an online education program and utilisation of the AMR cap. |
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Group governance
A membership review was carried out in July 2025, with membership considered in terms of representation and engagement. Two requests to join the group were denied due to current industry representation.
Suntory Beverage and Food Australia Pty Ltd accepted an invitation to join the group and was represented at the meeting by Victor Yee.
As part of governance for stakeholder groups, the group charter is required to be endorsed annually. The 2024 charter was provided in meeting papers for consideration. No comments were received from members and the charter will carry over for 2025.
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Action item |
Endorsement of 2025 charter |
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Responsibility |
Chair and members |
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Description |
The 2025 Alcohol Stakeholder Group (ASG) charter is to be distributed to members with the ASG meeting minutes for endorsement. |
Technical advice
The ATO continues to progress current determinations provide certainty to industry:
- Draft Excise Determination ED 2024/D2 Alcohol excise: the addition of water and the integral attributes of beer for the purposes of the Excise Tariff Act 1921
- Draft Wine Equalisation Tax Determination WETD 2024/D1 Wine equalisation tax: the addition of water to cider or perry
The draft determinations generated significant feedback over the last 12 months, particularly around possible unintended consequences and proposed date of effect. Extensive industry consultation has taken place with those providing feedback. Consultation will conclude by 22 August and industry members are encouraged to provide any additional feedback as soon as possible. Industry views and feedback are being carefully considered. If significant changes are proposed to the current drafts, the ATO may undertake targeted consultation with relevant stakeholders on those changes before the determinations are finalised. The ATO intends to finalise the determinations in 2025. In finalising the cider determination, and will be looking at the addition and use of sugar in cider manufacture at various stages.
Since the 2024 ASG meeting, 2 legislative instruments have been registered. These have replaced previous instruments, with minor amendments:
- A New Tax System (Goods and Services Tax) (Correct Wine Equalisation Tax Errors) Determination 2025. The update replaces the previous instrument which was due to sunset and sets out the circumstances in which an entity can correct WET errors in a later BAS period. This instrument aligns with increases made to debit error limits in a corresponding instrument in relation to correcting GST errors.
- Excise (Concessional Spirits – Class of Persons) Determination 2024 The update replaces the previous instrument which was due to sunset and sets out the requirements for entities to obtain spirits at a free rate of duty for specific purposes under the determination, without having to seek specific permission from the ATO. The update reintroduces limits on quantity before specific permission is required.
- Excise guidelines for the alcohol industry was updated to reflect recent deregulation streamlining measures and was published on 27 June 2025. A more comprehensive review is planned for this document.
Roundtable member comments
Treasury advised that government is working to give effect to 2 measures supporting the hospitality sector announced in the 2025–26 Budget:
- A 2 year pause on the indexation of draught beer excise from 1 August 2025
- Increase the excise alcohol manufacturer remission (AMR) cap to $400,000 for all eligible alcohol manufacturers and the WET producer rebate cap to $400,000 from 1 July 2026.
A tariff proposal has been finalised in relation to the indexation pause, which requires ratifying legislation to be tabled within 12 months. Relevant law change is being worked through for the increase to the excise remission cap and WET producer rebate cap.
Government is holding an Economic Reform Roundtable, with a focus on 3 main themes:
- making our economy more productive
- building resilience in the face of global uncertainty
- strengthening the budget and making it more sustainable.
Information on the Economic Reform RoundtableExternal Link, including the agenda and a short overview paper are available.
Australian Border Force advised they continue to support Treasury and the ATO in relation to relevant legislative amendments and will be undertaking compliance activity in relation to illicit alcohol activities.
Lion noted ongoing industry pressures from global issues, challenging market conditions and general increase in costs. Lion noted the pause in indexation of draught beer but would like to see general reform around alcohol taxation.
Good Drinks Australia referred to different payment terms on excise leaving bonded warehouses which has been raised by members. ATO advised that there are different reporting arrangements in place depending on legislative requirements, business size and compliance history, including weekly, monthly and quarterly. Changes to legislation would require advocacy to government. While aiding in cash flow for business, there is a balance required for budgetary objectives from a government perspective.
Brewers Association of Australia noted the pause in indexation of draught beer and advised that industry was looking to build a business case to government to demonstrate how a reduction to excise would benefit government and businesses and provide a better and fairer tax system.
Independent Brewers Association reiterated industry pressures, particularly for smaller producers. They noted cultural changes in the industry in terms of cheaper products being sold is not likely to be sustainable going forward. The IBA look forward to the finalisation of the determination on the addition of water and the integral attributes of beer.
Alepat Taylor referred to instances of alcohol sales below expected prices and was keen to ensure that use of the AMR was in line with policy intent.
Vok Beverages noted issues in the industry in relation to AMR and questions of eligibility. They provided feedback to the ATO regarding illicit alcohol activities in the current market and are keen to see industry support the ATO’s work in addressing these behaviours. We will be part of the Tier 2 ECM program and we are keen to hear more about that, as well as being very supportive of an online education module, which could assist not just new entrants, but also new starters in larger alcohol businesses.
Input was sought from the group in terms of illicit alcohol behaviours, in particular initiatives the ATO could undertake in addition to retailer visits to raise awareness of the behaviours and consequences. Suggestions to track product back to the source, including analysis of advertising channels, were put forward.
Manildra Group advised they have been recently contacted by the Office of Liquor and Gaming in Queensland regarding licensing permits in relation to a specific client and suggested working with the ATO to put together messaging for clients.
Australian Distillers’ Association noted that Australia has the third highest spirit tax in the world and ADA would continue to advocate to government for a fairer tax.
Metcash noted the benefits of the ATO’s ECM program and the introduction of recent deregulation measures. The removal of licence renewals was an administrative saving, and Metcash will be looking to engage in entity level licensing, however a delay in customs forms was an issue. Metcash have a continued interest in further deregulation measures such as work relating to ad valorem. Treasury advised that further deregulation is a matter for government consideration.
Members discussed current ATO efforts in relation to illicit alcohol activities. The ATO continues to consider improved ways to identify and address illicit alcohol behaviours including increasing its work with commonwealth and state and territory law enforcement agencies. Resources are devoted to an end-to-end strategy, utilising data matching to detect higher risk behaviour, retailer visits and online searches to identify new illicit product. The ATO is currently focusing attention on 'corrective' activities to dismantle illicit supply chains. Members are encouraged to share information or insights they may have in relation to the presence/distribution of illicit alcohol products.
Coles Financial Services noted a change in customer choices, substituting for cheaper products and noted that theft in the retail sector is increasing. They referred to the benefits of the ECM program, as well as membership of the ABF’s trusted trader program.
Endeavour Group Limited advised that results for the 2025 financial year would be published next week and reflected the current state of the industry, noting particularly the pressures on smaller producers.
Pernod Ricard supported ATO online knowledge sources being made available for WET and excise in small, medium and large markets.
Australian Grape and Wine Incorporated advised of an ongoing oversupply of wine in Australia, particularly red varieties, which continued to have a significant impact on industry They also referred to their review of the industry that was carried out by Dr Craig Emerson, which had recommended reforms to WET, which was a critical area of focus for the wine industry as it underpinned the financial viability of producers. It noted changes in consumer trends, including a rise in the ‘spritz’ culture. Product classification guidance on these products to provide further clarity as to whether they were treated as alcohol excisable or WET is appreciated.
Cider Australia referred to difficulties being experienced by industry in terms of cost of living, cost of inputs, and the impacts of extreme weather events.
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Action item |
Obligations messaging |
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Responsibility |
Michael Hughes, ATO |
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Description |
Excise Experience staff to liaise with Manildra Group about messaging for clients in relation to obligations. |
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Action item |
Customs forms |
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Responsibility |
Michael Hughes and Alex May |
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Description |
Excise Experience and ABF to follow up on the expected finalisation and publishing of Customs forms. |
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Action item |
Classification of spritz products |
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Responsibility |
Naomi Schell, ATO |
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Description |
Excise Experience to follow up with AGW in relation to product classification of ‘spritz’ products. |
Attendees
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Organisation |
Attendees |
|---|---|
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ATO |
Emma Butler (Chair), Small Business, Excise Experience |
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ATO |
Angelo Didone, Small Business, Excise Experience |
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ATO |
Brian Geovanovich, Small Business, Excise Experience |
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ATO |
Caroline Hill, Small Business, Excise Experience |
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ATO |
Claudia Bianco, ATO Corporate |
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ATO |
Kimley Vacher, Small Business, Excise Experience |
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ATO |
Michael Brooks, Small Business, Excise Experience |
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ATO |
Michael Hughes, Small Business, Excise Experience |
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ATO |
Naomi Schell, Small Business, Excise Experience |
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ATO |
Rufina Maurovic, Small Business, Excise Experience |
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ATO |
Shaun Wicks, Small Business, Excise Experience |
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Alepat Taylor |
Frank Ciampa |
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Australian Distillers' Association |
Christian Young |
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Australian Border Force |
Alex May |
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Australian Border Force |
Kate Theodore |
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Aldi Stores |
Adam Willacy |
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Australian Grape and Wine Incorporated |
Lisa Scott |
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Brewers' Association of Australia |
Amanda Watson |
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Campari Australia |
Robert MacKenzie |
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Cider Australia |
Warwick Billings |
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Coca Cola Amatil |
Karen McCoy |
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Coles |
George Nikolaou |
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Coopers Brewery |
Brad Grunert |
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Coopers Brewery |
Daniel Davila |
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Diageo Australia |
Prathish Seevaratnam |
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Endeavour Group Limited |
Priyanka Nagpaul-West |
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Good Drinks Australia |
Matt Morisey |
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Independent Brewers' Association |
Kylie Lethbridge |
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Lion |
Sonja Icanovski |
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Mainfreight Warehousing |
Andrew Robinson |
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Manildra Group |
Debbie Forster |
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Metcash |
Paul Onley |
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Pernod Ricard |
Diane Cooper |
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Samuel Smith and Son |
Vanessa George |
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Suntory Beverage and Food Australia Pty Ltd |
Victor Yee |
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Pernod Ricard |
Diane Cooper |
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Treasury |
Caitlin Payne |
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Treasury |
Juyeon Lee |
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Treasury |
Liz Jaspers |
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Treasury Wine Estates |
Lauren Baruta |
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Vok Beverages |
Rebecca Tolhurst |
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Wilmar BioEthanol |
Travis Hardy |
Apologies list
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Organisation |
Member |
|---|---|
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Angove's Proprietary |
Victoria Angove |
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Asahi Group Holdings |
Paul Jackson |
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Australian Border Force |
Kimberlee Clydesdale |
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Brown Forman Australia |
Jorge Jiminez |
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Spirits and Cocktails Australia |
Sasha Grebe |
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Tarac Australia Pty Ltd |
Robert Pelton |
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Wine Australia |
Ned Hewitson |