New tax tough on wine makers


Last week’s news of an increase in wine excise tax had me thinking about why in the world would anybody want to be a wine producer? 

Just to fill you in, the government has increased the tax by 12 cents per bottle. As producers are limited on how far they can push prices up in the current market, it is thought that, in general, 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 that this is part of the government’s attempt to stem the over-production of alcohol and deal with the saturated, under-priced grog sold on the cheap in our supermarkets and liquor stores. If it is, it really is hitting the wrong area, in much the same way as the 2003 tax increase on alcohol between 14 and 20 per cent meant to stifle access for young people to strong alcopops. It actually managed to kill fortified wine sales. 

The Granny Tax, as it was called, caused Sherry and Port prices to increase, meaning the older generation couldn’t afford it. ‘One rule for all’ legislation can be cruel. 

We obviously do have problems with alcohol consumption in New Zealand. It causes social and economic problems for many communities. 

Alcohol is a luxury, not a necessity. Do we really care if our Gran misses her late night Sherry or if we have to have one night off the booze because we can’t afford it anymore? I can’t see it creating much sympathy, which is why it’s such an easy target for a government that wants to increase taxes. 

The wine industry in New Zealand is a treasured gem, adding richness to our culture as well as the economy. 

The premium wines produced in Central Otago contribute very little to the alcohol problems we currently see. To view it as just alcohol, in the same light as industrially-produced alcopops, is misplaced. 

There are many passionate and dedicated people who farm their grapes and hand-make their wine to give people all over the world pleasure and exposure to the natural gifts of NZ, not to get them pissed. 

Of course there are industrial wines and people just in it for the money, but it’s not what the wine industry stands for in the main. Producing a quality, local product that is unique to the region it was grown in is a strong and integral driving force. That’s why many people go into the wine business. 

By the way, expect increases. Three of the biggest distributors in New Zealand put their prices up this week to compensate – and restaurants, shops and supermarkets will be passing that on. 

Click here for Paul Tudgay’s Wine Down site 

– Paul Tudgay is the Queenstown Resort College business hospitality manager, part-time wine appreciation lecturer and fulltime connoisseur