MELBOURNE, Australia — “Why is everything so expensive down here?” I recently demanded of a hapless wine clerk. To an American used to competitive wine prices — indeed, to competitive pricing on just about everything — Australia is an expensive place.

Here in Melbourne, dinner at a decent restaurant will cost about 80 Australian dollars, or $62 at the current exchange rate, and that’s before you order a bottle of wine, which typically starts at $40 and can soar to several hundred bucks. By the time you’re done, you’ve spent $100 a person at a normal, nothing-really-special restaurant.

Anyway, the clerk on the receiving end of my wine-buying frustration turned out to be not quite so hapless after all. “I can tell you why,” he drawled in what seemed to me to be a dead-on imitation of Crocodile Dundee. (It’s amazing how many Aussies do seem to sound like him.) “It’s the W.E.T.”

I looked suitably stupid, so he explained, “It’s the Wine Equalization Tax, which is the highest wine tax of any producing country in the world, or so I’m told. It’s 29% on the wholesale price of the wine.”

“Gee,” I said, backpedaling as fast as I could. “Given that, it’s amazing how cheap wine is here in Australia.”

He grinned. “Yeah, it’s something, isn’t it,” he said. “You can pick up some bottles of decent plonk for as little as $10.” That’s about eight American dollars.

Wine is not just a pastime pleasure down under. It’s a vast business that’s far more integrated into everyday Australian life than it is in America. You see many more wine shops here, even in small towns, than you do back home. Newspapers are plump with big advertisements touting wine sales. Articles and features about wineries and the so-called wine lifestyle abound. Everyone seems to drink wine.

Dry statistics give a new twist to the Aussie phrase “in the wet” (which really refers to the monsoon season in the Northern Territory). Australians drink almost three times as much wine as Americans. Never mind beer, with which Australia is traditionally associated. It’s wine that’s fast becoming the Australian symbol of the good life, even for the proverbial average bloke.

In 2004, Australian wine consumption reached an all-time high of 21.7 liters a person a year, according to Impact Databank, an American wine trade publication. In comparison, Americans drinks just 8 liters of wine a person a year.

So why do the Aussies endure such oppressive taxation? “Because they can,” the editor and publisher of Winestate magazine, Australia’s largest-circulation publication, Peter Simic, said. “It’s kind of strange, really. Because Australia — and I have to say New Zealand, too — are the most wine-educated countries in the world. It’s almost a kind of sinner’s tax.”

Mr. Simic pointed out that exported wines are not subject to the W.E.T., and that smaller wineries are not taxed on their first sales of $1 million (U.S. $800,000). The W.E.T. in the end, though, doesn’t truly bother Aussie consumers. “Really, it’s probably because we Aussies would rather whinge about it than actually do something,” he said. “We say ‘She’ll be right,’ and then go and have another drink.”

Philip Rich, a partner of Melbourne’s Prince Wine Store, laid out the details. “Let’s say we buy a wine for $10 wholesale,” he said. “We then pay 29% W.E.T. on that. So now it’s $12.90. Then we add a markup, which is typically 40%. So now it’s $18.06.”

“Then comes the kicker,” he continued. “Everyone in Australia pays a 10% G.S.T., which is the Goods and Services Tax. This gets included in the bottle price on the shelf. But the consumer is paying that 10% on the wholesale price plus the markup. So that $10 bottle wholesale works out to a retail price of $19.86, which, of course, we’ll round off to $19.99.”

According to Mr. Rich, “The average Aussie probably isn’t even aware of that 29% tax, although everyone knows about the 10% G.S.T. because it’s on the receipt, and as long as he can buy a decent wine for $10 — which he can quite easily — then everything’s all right. They’ll think wine is good value.”