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5/05/2017

Tax spat between anti-alcohol lobby and winemakers

The Winemakers’ Federation of Australia (WFA) has called for the anti-alcohol lobby to play fair with tax facts. Tony Battaglene, WFA chief executive said the latest allegations were “outrageous” as well as “insulting to the 170,000 workers” across the grape and wine community.

Yesterday, the Foundation for Alcohol Research and Education (FARE) published its latest research and promoted it with a media release headlined ‘Australians denied millions by alcohol company tax dodge’.

FARE claimed the alcohol industry was using “aggressive and questionable tax avoidance measures” to rob Australians of millions of dollars in tax revenue.

The research, commissioned by FARE and the Uniting Church, was undertaken by the University of Technology Sydney. It analysed 13 of the largest Australian and foreign-owned alcohol enterprises operating in Australia, looking into effective tax rates and book tax gaps using Australian Taxation data for years 2013–14 and 2014–15, comparing the companies’ total Financial Statements across the period. (The report is available from the FARE website, http://fare.org.au/)

The WFA said it was deeply disappointed with the allegations that Australian Winemakers were deliberately rorting the Australian Taxation system, pointing out the Australian wine industry was a significant economic contributor, particularly in rural and regional areas.

The Australian Wine Industry Contributes $40.2 billion in gross output to the Australian economy. Gross output includes $19.7 billion in value (value-added) and $10.4 billion in wages and salaries from full and part time employment. It also supports 172,736 full and part time jobs, most of which are located in regional Australia (numbers sourced from the ‘Australian Grape and Wine Authority Economic Contribution of the Australian Wine Sector Report’ December 2015).

“These allegations are outrageous and insulting to the 170,000 workers who rely on the wine sector for a living. The wine industry takes corporate governance seriously, and plays a significant role in Australia’s regional economies. It is disappointing that an anti-alcohol lobby group once again slurs the whole industry and regional Australia,” Battaglene said.

“The rather superficial analysis does not reflect the reality of either Australian wine businesses or tax law. A company paying lower levels of tax than the headline rates, reflects that either this year or in an earlier year they made a loss which they can apply to current profits. The wine sector, mostly family owned businesses, have weathered difficult trading conditions but remain long term and consistent providers of jobs and economic growth in regional Australia.”

Battaglene also said the Australian wine sector has been instrumental in the current Wine Equalisation Tax (WET) Reforms and is working closely with the Federal Government to achieve a fairer and tighter tax system for wine.

“Our industry pays its way, with some of the highest tax rates in the world. We have also recently worked closely with the government to tighten the current Wine Equalisation Tax System. I would encourage FARE to look at the facts for once, and acknowledge the recent reforms undertaken by the government, and the importance of the wine sector to Australia’s economy.”

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