News of an increase in wine excise tax has got me thinking about why anybody would want to be a wine producer.
The Government has just increased the tax by 12 cents a bottle and it’s believed the wine industry will just have to wear it.
It’s even worse if you’re just growing grapes. This is where wineries will try to claw back their profits – by squeezing the grower.
Some claim this is all part of Wellington’s attempt to stem the over-production of alcohol and deal with the glut of low-priced grog being sold in our supermarkets and liquor stores. In much the same way, the 2003 tax increase on alcohol between 14 and 20 per cent in strength was meant to halt young people getting access to alcopops – but it managed to kill sales of fortified wines.
The Granny Tax, as it was called, caused sherry and port prices to rise.
We clearly do have various social problems related to alcohol consumption in New Zealand.
But the premium wines produced in Central Otago have very little connection to the country’s booze issues.
There are many dedicated people here who farm their grapes and hand-make their wine to give pleasure to people the world over.
Of course there are industrial wines and people who are just in it for a quick buck, but it’s not what the wine industry stands for in the main.
By the way, expect prices to rise soon. Three of the biggest nationwide distributors put their prices up this week to compensate for the tax increase and restaurants, shops and supermarkets will be passing that on.
Paul Tudgay is the Queenstown Resort College business hospitality manager and a wine appreciation lecturer.