Impact of the Gst and Wine Tax Reform on Australia's Wine Industry: A CGE Analysis

13 Pages Posted: 1 Dec 2002

See all articles by Glyn Wittwer

Glyn Wittwer

Monash University - Centre of Policy Studies

Kym Anderson

University of Adelaide - Centre for International Economic Studies (CIES); Centre for Economic Policy Research (CEPR); Australian National University

Abstract

This study analyses the impacts of the Goods and Services Tax (GST) introduced on 1 July 2000, and the associated wine tax reform, on both the premium and non-premium segments of the grape and wine industry using a computable general equilibrium (CGE) model of the Australian economy. Through input cost reductions, the grape and wine industry is projected to gain from the GST tax package. Thus the industry can still gain even though wine consumption is taxed a little more heavily after than before the introduction of the GST. This is particularly so for the export-oriented premium wine segment. A switch from the current to a revenue-neutral volumetric tax on wine under the GST is shown also to favour the premium segment of the industry, but at the expense of the non-premium segment.

Suggested Citation

Wittwer, Glyn and Anderson, Kym, Impact of the Gst and Wine Tax Reform on Australia's Wine Industry: A CGE Analysis. Available at SSRN: https://ssrn.com/abstract=312032

Glyn Wittwer (Contact Author)

Monash University - Centre of Policy Studies ( email )

Victoria 3145, Vic 3800
Australia
61 3 9905 5421 (Phone)
61 3 9905 2426 (Fax)

Kym Anderson

University of Adelaide - Centre for International Economic Studies (CIES) ( email )

School of Economics
Adelaide SA 5005
Australia
+61 8 8313 4712 (Phone)
+61 8 8223 1460 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Australian National University ( email )

Arndt-Corden Dept of Economics
Coombs Building
Canberra, AK ACT 2600
Australia
+61 8 8313 4712 (Phone)

HOME PAGE: http://publicpolicy.anu.edu.au/crawford_people/content/staff/acde/kanderson.php

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