Spirits and beer taxes to soar, industry warns of "unaffordable luxury"
Distillers and brewers are going to war with the Albanese government over constantly increasing alcohol taxes.
Maybe Group director Stefano Cantino has called for booze taxes to be “drastically” cut to support local distillers, before they destroy the local liquor industry
Cantino has questioned why local spirits are more expensive in Australia than international spirits.
“I live in Alexandria, and there is a distillery 10 minutes from my house.
“Their alcohol is more expensive than something that I can buy from England, which is shipped in a container and arrives here at $10 or $20 cheaper,” he said.
Cantino is part of a movement in which distillers and brewers who have called for taxes to be frozen before they rise again in a few weeks.
Starting in February, taxes on spirits and beer will rise again, driven by a six-month inflation-linked increase. The liquor industry says it will devastate local producers and transform a night out into an unaffordable luxury.
With the price of drinks set to climb next month, politics will inevitably infiltrate pubs across regional NSW. One campaign, focused on marginal seats, aims to abolish the "unbearable" alcohol tax. The liquor industry is actively lobbying both major parties for reform ahead of the upcoming election.
This comes as senior Coalition members urge Opposition Leader Peter Dutton to commit to cutting or freezing alcohol taxes as a cost-of-living relief measure.
Despite rising prices leading to decreased consumption, spirits taxes are projected to generate a substantial $14 billion for the federal government by 2027-28. Australia already boasts one of the highest spirits tax rates globally, currently at $103.89 per litre of alcohol.
Industry experts anticipate this figure to reach $105 per litre next month, with another increase expected in six months.
“These twice yearly spirits tax increases are holding back Australia’s 700 distilleries, many of them small businesses,” Australian Distillers Association CEO Paul McLeay said.
Beer excise will raise $11.5 billion for the government over the forward estimates.
“Every time you go to the bottleshop and you buy a slab, half of that goes straight to the federal government,” Brewers Association of Australia CEO John Preston said.
Even Bundaberg Rum is getting in on the action with a marginal seat blitz in NSW against the “unbearable” tax on booze.
“At the moment, on roughly a $61 one-litre bottle of Bundaberg rum, about $38 is tax,” Bundaberg Distilling Company chair Amanda Lampe told The Daily Telegraph.
“Bundy drinkers and spirit drinkers in Australia are paying seven times more in tax than in than in the United States,” Ms Lampe said.
Australian Hotels Association NSW CEO John Whelan has also called for a sector-wide indexation freeze.
“This is a hidden tax which increases the cost of a drink every February & August,” he said.
Nationals Leader David Littleproud is on board with a freeze.
“We want to reduce as many taxes as we possibly can, when we can afford it, and the alcohol excise sits within that remit that the Coalition will consider,” he told the Telegraph.
Treasurer Jim Chalmers’ spokesperson said the increase was the “usual, legislated, automatic indexation change that happens twice a year under governments of both persuasions and it’s not a new decision of this government”.
Jonathan Jackson, 28th January 2024
