ABOUT half of Australia's 2500 wineries would be "sent to the wall" if a volumetric tax were introduced, a SA winemaker says.Taylors Wines managing director and Winemakers' Federation of Australia director Mitchell Taylor said he was "very annoyed" by calls for a volumetric tax, and said Australian winemakers were already paying more than their fair share of tax.
An Australian National Preventative Health Agency report last week found the operation of the Wine Equalisation Tax was of concern and required reappraisal.
Wine is taxed on the value of the wine; a volumetric tax would focus on the alcohol content, so the price of cask wine would likely almost double.
Mildura-based Murray Valley Winegrowers chief executive Mark McKenzie said its 550 growers absolutely opposed a wine tax change.
The Foundation for Alcohol Research and Education wants the WET abolished.
"The WET is a bad tax that simply encourages the production of cheap wine, which is by far the cheapest alcohol available in Australia," chief executive Michael Thorn said.
"The end result is a market flooded with alcohol sold as cheaply as $2 a bottle."
Mr Taylor said suggestions the WET encouraged the production of cheap wine were false.
"Under the current taxation system I'm not encouraged to make wine any cheaper than it is," he said.
"In fact, from what I hear within the industry, the cheaper the wine the smaller the margins and the less profit. So that is not correct."