EXC 2006/1 - Explanatory statement
Australian Government
A New Tax System (Wine Equalisation Tax) Act 1999
This instrument sets out the time when a claim for the wine equalisation tax (WET) producer rebate may be made by eligible New Zealand wine producers. This instrument may be cited as the Wine Equalisation Tax New Zealand Producer Rebate Claim Lodgment Determination 2006.
The authority for this instrument is provided by subsection 17-10(2B) of the A New Tax System (Wine Equalisation Tax) Act 1999 (WET Act). The instrument is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Date of effectThis instrument commences from 1 July 2006 or from the commencement of Schedule 4 to the Tax Laws Amendment (2005 Measures No. 4) Act 2005, whichever is the later. This commencement date is aligned with the date from which the entitlement to the WET producer rebate by eligible New Zealand wine producers first arises. This is an appropriate date for commencement of this instrument as a valid claim for the rebate could not be made before that time.
What this instrument is about:Under the WET Act, eligible wine producers can claim a WET producer rebate of up to A$290,000 per year. The WET producer rebate was originally only available to wine producers who were registered for goods and services tax (GST) in Australia. However, entitlement to the rebate has now been extended to include non-GST registered producers of wine in New Zealand that export their wine to Australia and that meet certain eligibility criteria. This extension was made through amendments to the WET Act in the Tax Laws Amendment (2005 Measures No. 4) Act 2005.
A WET producer rebate under the scheme for New Zealand wine producers will only be available if, amongst other things, WET has been paid in Australia in respect of the wine subject to a rebate claim. The entitlement to the rebate arises immediately before the end of the Australian financial year in which the WET was paid.
A New Zealand wine producer that is eligible to claim a WET producer rebate under the scheme must lodge a claim for the rebate in the form approved by the Australian Commissioner of Taxation, along with specified supporting evidence for the claim. A claim must be lodged within four years after the time when the entitlement to the rebate arises.
Although entitlement to the rebate arises immediately before the end of the financial year in which the WET was paid for wine that is the subject of the rebate claim, the legislation provides that the Australian Commissioner of Taxation may determine when claims for the rebate may actually be made. A special claim cycle is required for non-GST registered New Zealand participants as the claim cannot be aligned with lodgment of GST obligations as can occur in the case of GST registered entities.
This instrument sets out when a claim for the WET producer rebate may be made under the producer rebate scheme for New Zealand wine producers.
Effect of this instrument:This instrument provides that a claim for a WET producer rebate under the rebate scheme for New Zealand wine producers may be made:
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- any time after the entitlement to the rebate arises (ie at the end of the Australian financial year in which WET was paid on the wine); and
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- within 4 years of the time that the entitlement to the rebate arises.
This instrument provides New Zealand entities with significant flexibility in relation to the time at which they choose to lodge a claim for the WET producer rebate, thereby reducing the costs of compliance for such entities.
Consultation:Where possible, the Australian Taxation Office endeavours to design its administrative processes to take into account the needs of users of its products and services to make the experience of interaction with the revenue authority easier, cheaper and more personalised. In line with this approach, user research and design workshops were held in Auckland, New Zealand in June 2005 to discuss various aspects of the proposed scheme for the WET producer rebate for New Zealand wine producers.
As part of these workshops, attended by executives of the New Zealand Winegrowers' Association, and representative New Zealand winemakers selected by the association, the concept of being able to claim the rebate immediately after the end of the Australian financial year in which the entitlement arises was put forward for consideration. Clients confirmed that the ability to claim immediately after the Australian financial year would be acceptable to them.
In subsequent information seminars, held in August 2005, in various winegrowing regions of New Zealand, the ability to claim immediately after the end of the Australian financial year in which the entitlement arises was once again put forward as one of the possible outcomes for the implementation of the rebate system. These seminars were attended by at least 70% of New Zealand wine producers and there was no adverse comment from participants in relation to this proposal.
New Zealand Inland Revenue and the Australian Department of the Treasury were also consulted in relation to the development of this instrument.
23 March 2006
Commissioner of Taxation
EXC 2006/1 - Legislative Determination