4 Jul 2011

Excise tax brings 'tougher times' for wineries

3:25 pm on 4 July 2011

New Zealand Winegrowers says the latest rise in excise tax could not have come at a worse time for wine companies.

The increase of 12 cents a litre, which came into force on Friday, is the largest in more than 20 years and lifts the tax to $2.72 cents per litre.

Winegrowers chief executive Philip Gregan says there is a misconception that excise is a tax consumers end up paying - but that is not the case.

Mr Gregan says wineries have always had difficulty passing the cost on, and the latest rise in excise will be no exception.

Wine exported does not attract excise tax and the 300 small wineries that only supply the domestic market will be hit hardest, he says.