Tax change falls short: Growers

Changes in how tax excise is paid will be welcomed by some small and struggling wineries in Hawke's Bay but did not address the one issue winegrowers have been lobbying to have addressed for the past 35 years.
The issue being - the imposition of an excise duty upon a land-based industry which was vital to the economy and employs a large number of people.
"Tax excise makes up 37 per cent of the average bottle price," Hawke's Bay Winegrowers Association chairman Nicholas Buck said.
"That is a massive burden for wineries, particularly smaller ones, to deal with," he said.
The Government announced on Thursday that smaller wineries, with tax liabilities of $50,000 or less, will be able to pay their excise taxes annually rather than the present monthly.
The new changes to excise tax payments come into place from July 1 and will affect about half the country's 700 wineries.
Under the new rules the payment requirements are: wineries with a tax liability of $100,000 or more - excise to be paid monthly; wineries with tax liabilities between $50,000 and $100,000 - excise to be paid six-monthly; wineries with tax liabilities of $50,000 or less - to be paid annually.
Presently, amidst excise thresholds which have been in place and untouched for the past 14 years, only wineries with a tax liability of less than $10,000 were exempted from paying monthly.
"This is great news for our smaller, domestically orientated wineries. It cuts administrative costs, and helps to better balance cash flows," Tuki Tuki MP Craig Foss said.
To which Mr Buck agreed.
"It's nice of the Government to do that for the industry and we will thank them, but it does not address the core issue of the excise itself."
Mr Buck said countries like France, Italy and Spain paid "virtually nothing" in excise, and said it was little wonder they were world leaders in the industry.
He said if the dairy or other land-based New Zealand industries were told to pay similar taxes it would be deemed unacceptable.
The industry has long called for excise taxes to be collected directly from retailers rather than the wineries.
Napier MP Chris Tremain said the move underlined the Government's programme of reducing compliance costs and red-tape to support local businesses.
"New Zealand's wine industry is vital to our economy. It's a $1.1 billion export earner, creating valuable jobs and boosting investment in Hawke's Bay," Mr Tremain said.
Mr Buck said the industry would continue to lobby for a change in tax excise laws.