From July 1, thresholds for the payment of excise tax will lift tenfold, allowing smaller wineries to shift from monthly payments to six-monthly or yearly payments.
Currently, only wineries with a tax liability of less than $10,000 are exempt from paying monthly.
The new thresholds are: $100,000 or more, excise to be paid monthly; $50,000-$100,000, excise to be paid six-monthly; $50,000 or less, excise to be paid annually.
Jim Jerram, from Ostler Wines in the Waitaki Valley, was "delighted" with the announcement.
"It makes quite a significant difference in removing compliance costs. It is also allowing us to keep money in circulation a bit longer."
Anything that helped reduce the "top-heavy" compliance costs at both the civil servant end and the industry end had to be a good thing, he said.
The wine industry was a $1.1 billion export earner for New Zealand and a vital contributor to the regional economy. It should not be hobbled by unnecessary red tape and regulation, Economic Development Minister David Carter said.
"This is the first change to the thresholds in 14 years and is a commonsense solution to reducing the regulatory burden on our small wine producers.
"This is not about reducing their tax obligations but about aligning excise payment with revenue flows," Mr Carter said.
The changes would "put money in wine producers' pockets for longer", Customs Minister Maurice Williamson said.
"These changes will help many smaller wineries cut their administration costs and balance cash flows and, in a number of cases, will enable wineries to stay in business.
"More than 350 businesses around the country are likely to benefit and this will have a positive flow-on effect in wine producing areas," he said.
The changes would be a "big boost" to the wine industry in Central Otago and Waitaki, Waitaki MP Jacqui Dean said.
"Some wineries in our region are struggling in these tough economic times. These changes ... could mean the difference between staying in business or going bust."
