Edited version of private advice

Authorisation Number: 1051893982158

Date of advice: 3 September 2021

Ruling

Subject: Wine equalisation tax - product classification

Question

Does your product meet the definition of 'fruit or vegetable wine' as defined in section 31-4 of the A New Tax System (Wine Equalisation Tax) Act 1999 (the WET Act)?

Answer

Yes, your product, meets the definition of 'fruit or vegetable wine' as defined in section 31-4 of the WET Act.

This ruling applies for the following period

3 September 20XX to 2 September 20XX

The scheme commences on

3 September 20XX

Relevant facts and circumstances

You are registered for goods and services tax and wine equalisation tax.

You plan to produce a fermented fruit beverage (your product).

Your product is made by fermenting a solution consisting of the juice or must of fruit, with the addition of various additives to support the fermentation process or used as processing aids.

The additives do not contribute any colour or flavour to your product.

Your product will have an alcoholic content of at least 8% alcohol by volume (abv) and less than 22% abv.

Relevant legislative provisions

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

A New Tax System (Wine Equalisation Tax) Act 1999 Subdivision 31-A

A New Tax System (Wine Equalisation Tax) Regulations 2000 Regulation 31-4.01

Reasons for decision

'Wine' is defined in section 33-1 of the WET Act as having the meaning given by Subdivision 31-A of the WET Act.

Section 31-1 in Subdivision 31-A of the WET Act provides that wine means any of the following:

•         grape wine

•         grape wine products

•         fruit or vegetable wine

•         cider or perry

•         mead

•         sake.

However, wine does not include beverages that do not contain more than 1.15% by volume of ethyl alcohol.

All of the beverages set out above are separately defined for the purposes of the WET Act and, of these definitions, 'fruit or vegetable wine' is the only one that is relevant in your circumstances.

Fruit or vegetable wine

'Fruit or vegetable wine' is defined in section 31-4 of the WET Act. It is also subject to certain requirements as specified in regulation 31-4.01 of the A New Tax System (Wine Equalisation Tax) Regulations 2000 (WET Regulations).

A fruit or vegetable wine, taking into account the requirements of both the WET Act and WET Regulations, is a beverage that:

•         is the product of the complete or partial fermentation of the juice or must of fruit or vegetables, or products derived solely from fruit or vegetables

•         has not had added to it, at any time, any ethyl alcohol from any other source, except grape spirit or neutral spirit, as specified in the WET Regulations

•         has not had added any liquor or substance that gives colour or flavour (other than grape spirit or neutral spirit), and

•         contains between 8% and 22% (inclusive) of ethyl alcohol by volume or, if grape spirit or neutral spirit has been added, contains between 15% and 22% (inclusive) of ethyl alcohol by volume.

In order to determine whether your product is a fruit or vegetable wine, each criterion of the definition needs to be considered.

Product of the complete or partial fermentation of the juice or must of fruit or vegetables, or products derived solely from fruit or vegetables

Your product is made by fermenting a solution consisting of the juice or must of fruit. Therefore, your product satisfies this criterion.

Has not had added to it, at any time, any ethyl alcohol from any other source

Your product does not have any ethyl alcohol added. Therefore, your product satisfies this criterion.

Has not had added to it, at any time, any liquor or substance that gives colour or flavour

Throughout the production process, a small number of ingredients will be added to your product to support the fermentation process or as processing aids. These additives do not give colour or flavour to your product, and therefore, your product satisfies this criterion.

Contains between 8% and 22% of ethyl alcohol by volume

The final alcoholic strength of your product will be at least 8% abv and less than 22% abv.Therefore, your product satisfies this criterion.

Conclusion

Your product satisfies all of the criteria within the definition of 'fruit or vegetable wine' in section 31-4 of the WET Act and regulation 31-4.01 in the WET Regulations and would therefore be considered a 'fruit or vegetable wine'.