Drafting error in new Act to be corrected
WELLINGTON: A drafting error in law that would have lowered the price of Champagne by omitting it from alcohol excise and exciseequivalent table is about to be corrected in Parliament.
The mistake would have come into effect on October 1 but will be corrected by a supplementary order paper.
Last year, the New Zealand Customs Service collected about $2.7 million in exciseequivalent duty on Champagne and about $2.3 million the previous year.
Customs Minister Meka Whaitiri said the mistake was made by Customs during the preparation of the Customs and Excise Bill in 2016.
‘‘The Customs and Excise Act 2018 replaces the 1996 Customs and Excise Act that is over 20 years old and, in some parts, over 100 years old.
‘‘The structure and drafting of the new Act has been rewritten and modernised, and that process is where this error occurred.’’
Ms Whaitiri said she had conveyed her disappointment to Customs about the error.
Spirits New Zealand chief executive Robert Brewer said it was good to see the Bill tidied up to ensure all imported beverage alcohol was subject to an excise.
‘‘The impact on overall taxtake for government would have probably been minimal since Champagne is taxed at about $22 per litre of alcohol at the border and imported volumes are probably relatively low, but it’s good to see this being fixed.
‘‘However, not many of us realise that the excise on spirits — at $52 per litre of alcohol – is over double what it is for beer and wine and, along with GST, accounts for almost 75% of the legitimate retail price for spirits.
‘‘The impact of this excise difference is that it makes spirits an attractive smuggling prospect as well as being a burden on our growing New Zealand distilling industry.’’ — NZME