Wine Equalisation Tax: cider manufacture

Is reconstituted apple juice the juice of apples for the purposes of the definition of 'cider or perry' as defined in paragraph 31-5(a) of the A New Tax System (Wine Equalisation Tax) Act 1999 (WET Act)?

Yes. Reconstituted apple juice is the juice of apples for the purposes of the definition of 'cider or perry' in paragraph 31-5(a) of the WET Act.

The juice of apples is extracted from apples and then subjected to an evaporation process whereby water vapour is removed to produce apple juice concentrate.

As a consequence of the concentration process, volatile aromatic components are also removed from the juice. These aromatic compounds are condensed to liquid and called apple juice condensate.

The apple juice condensate is obtained solely via the concentration process and contains only the natural aromatic compounds of apple juice.

Apple juice condensate is re-introduced to concentrated apple juice to restore the original aroma and flavour of the juice.

The apple juice concentrate, apple juice condensate and water are combined to produce a reconstituted apple juice, which is then fermented.

Section 31-5 of the WET Act defines 'cider or perry' to mean a beverage that: (a) is the product of the complete or partial fermentation of the juice or must of apples or pears; and (b) has not had added to it, at any time, any ethyl alcohol from any other source, except as specified in the regulations; and (c) has not had added to it, at any time, any liquor or substance (other than water or the juice or must of apples or pears) that gives colour or flavour, except as specified in the regulations; and (d) complies with any requirements of the regulations, made for the purposes of section 31-8, relating to cider or perry.

Paragraph 31-5(a) of the WET Act requires the beverage to be the product of the fermentation of the juice of apples. However, it does not preclude the use of a reconstituted apple juice.

The use of the phrase 'reconstituted apple juice' in this context is simply a reference to a product that is the combination of the products derived from the juice of apples. It does not require 'reconstituted apple juice' to adhere to the requirements of the Australia New Zealand Food Standards Code.

The Commissioner accepts that the juice of apples that has been concentrated and later reconstituted with water to a concentration consistent with that of the undiluted juice is the juice of apples for the purposes of paragraph 31-5(a) of the WET Act.

The Commissioner also accepts that the juice of apples extends to combinations of products derived solely from the juice of apples.

Apple juice concentrate and apple juice condensate are products derived from the juice of apples.

As such, the combining of apple juice concentrate and apple juice condensate with water does not prevent the product from being the juice of apples for the purposes of paragraph 31-5(a) of the WET Act.

The addition of apple juice condensate to merely reconstitute apple juice for fermentation is not adding a substance to give flavour to the juice as contemplated by paragraph 31-5(c) of the WET Act.

As such, the reconstituted apple juice which is the product of combining apple juice concentrate, apple juice condensate and water is the same as the juice of apples for the purposes of paragraph 31-5(a) of the WET Act. Note: Apple juice condensate is not always collected in the production of apple juice concentrate. The above does not imply that reconstituted apple juice must include apple juice condensate.