The Government has announced that it will cap the Wine Equalisation Tax (WET) rebate at $350,000 after having originally proposed to reduce it from $500,000 to $290,000.

The original announcement of a reduction of the WET rebate earlier this year had been met with some concern from the industry with fears that it would hurt small to medium sized wine businesses who would have to start paying the tax.

Tony Battaglene, CEO of the Winemakers Federation of Australia said, “[the] decision will put an end to uncertainty and put the industry in a stronger long-term position.”

Battaglene also said that the revised eligibility criteria would benefit emerging winemakers making a start in the industry.

“This rebate is critical to rural and regional communities and jobs, as well as future investment and growth.”

The compromise on the WET rebate cap is coupled with a $100,000 grant scheme focusing on investment at the cellar door.

President of the NSW Wine Industry Association, Tom Ward, said the announcement of the grant scheme is seen “as a positive step and we look forward to working with Government to ensure industry continues to benefit.

The reform is also extended to cider producers that sell branded Australian cider and perry. Cider Australia president Sam Reid was pleased with the Government’s decision and said it would support rural and regional communities and drive diversity and ongoing growth in the Australian cider market.

“Once these reforms are enacted, a cider business will need to own the apples and pears in a product, from pressing through to the final packaging, in effect restricting ciders made from imported juice concentrate,” Reid said.

“It’s also a great opportunity for us to start a conversation about Australian craft cider, which we feel will be the next growth driver for the category.”

The change to the rebate has been deferred until 1 July 2018, giving wine producers more time to transition to the new cap.