Australia’s brewers and distillers have hit out at the excise hike of 1.4 per cent announced by the Australian Tax Office (ATO), labelling the move a “kick in the guts”

The ATO hike is the 19th tax increase in the last decade with Australian distillers already paying the third highest spirits tax in the world.

Spirits and Cocktails Australia CEO Greg Holland said: “This is a never-ending tax with an ever-increasing appetite.

“It has always been a handbrake on the growth of businesses that could otherwise be employing more staff, buying more local produce, exporting quality Australian products, and attracting more tourists to local communities.

“But with COVID, this latest tax hike feels particularly savage. It’s a kick in the guts to the many distillers and manufacturers, pubs, bars and restaurants who are struggling in the face of repeated lockdowns and a decline in tourism.”

A joint campaign by Spirits and Cocktails Australia and the Australian Distillers Association has called on the Federal Government to freeze the excise increases for at least three years to give the industry a chance to consolidate and recover from the devastating impact of rolling COVID lockdowns.

“But after some very welcome relief in the Federal Budget, where the government increased the excise cap for small distillers from $100,000 to $350,000, the return to automatic excise hikes looks like Canberra giving with one hand and taking with the other,” Holland said.

“The Budget’s increase in the excise cap was worth about $20million for the industry. But today’s hike could drag up to five times that amount back in tax.”

The high tax and twice-yearly increase has created a situation in Australia where up to 60 per cent of the retail price of an average 700ml bottle of spirits is now tax.

“That is an outrageous burden, imposed by the Federal Government, on a sector that could otherwise be replicating the growth of the Australian wine sector,” Holland said.

Meanwhile the Brewers Association has called for the tax on beer sold in pub and clubs to be halved.

CEO, John Preston, said: “Pub and bar operators in Sydney today are focused on keeping their business going and looking out for their staff – the last thing they should be worried about is a tax increase.

“We believe there is an opportunity for the Government to provide a helping hand to pubs and clubs by halving the tax rate to give hospitality venues a fighting chance once things open back up.”

The association said that a tax cut would help pubs, clubs and bars to rebuild after the impacts of COVID lockdowns.

Andy Young

Andy joined Intermedia as Editor of The Shout in 2015, writing news on a daily basis and also writing features for National Liquor News. Now Managing Editor of both The Shout and Bars and Clubs.

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