Wine Law

This Law was reformed in 2005 33 , 2007 34 and 2014 35 , and, with each reform, the tax was increased until reaching, in the current law, a tax of 35% on the retail price (Art. 18). In 2015, the Law was complemented by a Ruling issued by the National Integrated Service on Customs and Tax Administration (SENIAT, by its acronym in Spanish), through which manufacturers, artisanal producers and importers of alcoholic beverages are designated as agents for collecting the value- added tax (VAT) 36 . The Lawwas last regulated in 1985 and this Regulation, which is still in force, defines wine, in Article 2 ordinal 18, as “the product obtained from the total or partial alcoholic fermentation of the grape juice or must with or without the addition of water before fermentation and with a real strength between 7° and 14° Gay-Lussac, both inclusive. When it is made with raisins, this condition of the fruit will be indicated on the label” 37 . In addition to this tax and the VAT, which is currently 16% 38 , Venezuelan legislation imposes a parafiscal contribution of 2% of gross sales to companies that carry out activities related to the 33 Official Gazette No. 38.238, 28 July 2005. 34 Special Official Gazette No. 5.852, 5 October 2007. 35 Special Official Gazette No. 6.151, 18 November 2014 36 Official Gazette No. 40.656, 8 May 2015. 37 The Regulation adds, in its Article 2, the following definitions related to wine: “19. Gasified Wine: It is the wine to which, after its final elaboration, pure carbon dioxide is added. 20. Sparkling Wine: It is the wine whose carbon dioxide comes from a second fermentation of natural grape sugar carried out in closed containers. 21. Champagne: It is the wine whose carbon dioxide comes exclusively from a second fermentation of additional sugars introduced, such as tirage liquor, which takes place in the bottles that reach the consumer, and is applied exclusively to the product made in the region from Champagne, France. It can be added to the so-called “Expedition Liquor” to obtain the dry, semi-dry and sweet types, reserving the names “brut” or “natural” to distinguish the original product in each case. 22. Fruit Wine: It is the wine obtained by the alcoholic fermentation of the juice or must of any fresh or dried fruit other than grapes, with or without the addition of sucrose and water before fermentation, to obtain an alcoholic degree between 7° and 14° GL, inclusive, which must come from at least 50% of the sugars in the fruit. This product must be designated with the name and condition of the fruit used. 23. Liquor Wine: It is the wine with an alcoholic degree higher than 14° GL, without exceeding 20° GL, from the alcoholic fermentation of the grape juice or must, whether or not with alcohol. If headed, the addition of alcohol may not exceed 10% of the actual volume of the species to be processed. 24. Compound Wine: It is the wine made by mixing natural wine of grapes in a proportion not less than 75% of the total volume of the species and alcohol with distillates of vegetables or parts of these, macerations, infusions of the same, mixtures of them, grape musts or juices and other vegetables, concentrated or not, sugars, caramel, liquor wines and other substances authorised by the Ministry of Health. The actual strength of these wines must be greater than 14° GL, without exceeding 20° GL. When liquor wines are used in the production of compound wines, the addition of alcohol may be dispensed”. 38 Presidential Decree No. 4.079, Official Gazette No. 41.788, 26 December 2019. In addition, the Constituent Decree of Partial Reform of the Decree with Rank, Value and Force of Law that establishes the Value Added Tax (Special Official