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Subject: Wine equalisation tax

Question 1

Are you liable to pay WET when you import wine into Australia on behalf of Australian travellers?

Answer

Yes.

Question 2

Are you entitled to the New Zealand producer rebate?

Answer

No.

This ruling applies for the following periods:

From 4 April 2012.

The scheme commences on:

The scheme has already commenced.

Relevant facts and circumstances

1. An Australian traveller purchases wine at the cellar door of a New Zealand winery.

2. The New Zealand winery registers the purchase with you.

3. You arrange shipment of the wine to the traveller's residence in Australia.

4. You pay WET to Customs at importation.

5. You do not enter any sale amount on your business activity statement (BAS) for this transaction.

Relevant legislative provisions

A New Tax System (Wine Equalisation Tax) Act 1999 section 5-5

A New Tax System (Wine Equalisation Tax) Act 1999 subsection 19-5(2)

A New Tax System (Wine Equalisation Tax) Act 1999 paragraph 23-5(1)(a)

A New Tax System (Wine Equalisation Tax) Act 1999 section 33-1

A New Tax System (Goods and Services Tax) Act 1999 section 195-1

Reasons for decision

Question 1

Summary

You are liable to pay WET to Customs when you import wine into Australia on behalf of Australian travellers.

Detailed reasoning

Section 5-5 of the A New Tax System (Wine Equalisation Tax) Act 1999 (WET Act) sets out the assessable dealings with wine in an Assessable Dealings Table. Assessable dealing AD10 states that the local entry of imported wine is an assessable dealing. The entity liable for WET is the entity that makes the local entry. The time of the dealing is the time at which WET is payable under section 23-5.

Paragraph 23-5(1)(a) explains that amounts of WET on customs dealings are to be paid at the same time, at the same place, and in the same manner as customs duty payable on the wine in question, or would be payable if the wine were subject to customs duty.

According to AD10 of the Assessable Dealings Table, the taxable value of the dealing is the GST importation value. This is defined in section 33-1 of the WET Act as an amount equal to what would be the value of the local entry (disregarding any WET payable in respect of the local entry), for the purposes of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act), if it were a taxable importation within the meaning of section 195-1 of the GST Act.

Paragraph 156 of Wine Equalisation Tax Ruling WETR 2009/1 explains that the GST importation value is the customs value of the wine plus the costs of transport, insurance and duty.

Subsection 5-5(3) of the WET Act explains that the amount of WET is 29% of the taxable value of an assessable dealing.

You import wine from New Zealand into Australia on behalf of Australian travellers. As you are the entity making the local entry, you are liable to pay WET to Customs. The amount of WET payable is 29% of the GST importation value of the wine. You are not required to report any WET amounts on your BAS for this dealing.

Question 2

Summary

You are not entitled to claim the New Zealand producer rebate.

Detailed reasoning

Subsection 19-5(2) of the WET Act provides entitlement to the New Zealand producer rebate for rebatable wine for a financial year if:

In order to be entitled to the New Zealand producer rebate, you must satisfy all of the requirements of subsection 19-5(2) of the WET Act. You have not provided any information to show that you are a producer of the wine that you export from New Zealand into Australia. You therefore do not satisfy all of the requirements of subsection 19-5(2) of the WET Act and you are consequently not entitled to the New Zealand producer rebate.

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