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This week, in the Federation Chamber, we heard from a number of federal Members of Parliament about the challenges facing independent brewers and a request that the Labor Government develop a sensible package of tax reform policies that balance the responsible consumption of alcohol.

In response the ALP Members of Parliament said that the Government was unwilling to consider any changes because excise revenue was important to a balanced budget – without a care for the job loss or our Australian small businesses.

The following representation made in the Chamber sum up our issues perfectly:

“I think most people would understand that the excise we put on alcohol goes up twice every year and that it has been doing that for 30 years, so the compounding effect of these price increases is obviously making many things unaffordable.

I just want to remind the chamber of two stats, and they are these: 60% of the cost of packaged full-strength beers and 47% of the cost of mid-strength beers is now tax. So, basically, just under half of what a mid-strength beer costs you is a tax and 60%of a full-strength beer is a tax.

As I know—we all know—that the intention of this, when it was brought in, was good. The intention was to discourage antisocial behaviour or to discourage behaviour that would not be good for your health, but I think we have gone beyond that now. We’ve gone way beyond that.  Dare I say it, governments are now a little bit addicted to the revenue that they get from this and the compounding effect of that revenue.” Said Mr Kevin Hogan, Member for Page.

Dr Gillespie, Member for Lynne added: “I’ll be calling on the Treasurer and the finance minister in the next budget to announce a freeze on the excise so that we can keep our local brewers and distilleries.

…

The value of small breweries and distilleries is that there’s not some distant faraway shareholder that’s taking profits out of the business; all the people working in them live locally and all the money circulates into the local economy.

It’s much better to have these little breweries rather than huge, international breweries off in faraway capital cities, where you can still get a beer and you can still buy a gin and tonic but it’s not the same because you’re not helping your local economy. I commend this issue to many on both sides, to take the time to educate the financial ministers in Finance and Treasury that they are about to kill the goose that laid the golden egg, so to speak.”

And that’s the truth of it.  If government really cared about having a real impact on overconsumption of alcohol they would ensure that wine was just as unaffordable as beer.    

Wine is not subject to excise, but rather WET tax, it is not indexed to inflation and does not automatically increase twice a year.  Since the 1980’s the retail wine price index has fallen by more than one third, while the beer price indexes have increased by about half.  

Today, beer drinkers pay double the tax per standard drink compared to bottled wine and eight times the tax rate per standard drink of cask wine.

According to the Australian Institute of Health and Welfare’s statistics published in October 2023, wine continues to be the largest contributor to apparent consumption of pure alcohol in Australia.

So there is more cheap wine available in our market than any other alcohol product but we can’t address that problem – we will just keep making beer more expensive?

Independent breweries have led the way in developing a full flavour low and no alcohol for some time.  Professor Anderson from the University of Adelaide found that “Beer moderation has been the key contributor to Australia’s reduction in per capita alcohol consumption over the past half-century.”

So the question is, why isn’t government supporting the industry that is actively supporting the health outcomes they want?

The answer is simple.  The Albanese Government cares about balancing a budget more than it does about Australian consumers.

Wine has always been an export product and a GDP contributor.  And beer is for the domestic market.  The Albanese Government wants all the benefits of wine to GDP and punishes independent breweries for just wanting to be small businesses that are part of their local community.

They don’t care that the 600+ independent breweries around the country provide a local meeting place for their consumers, that we employ local, support our local footy club or that consumers can support a small family owned business. 

The Albanese Government can try to hide behind claims that it can’t reform excise because it cares about problem drinking but that simply isn’t true.  It has become addicted to the revenue from our small businesses and doesn’t care about communities or the cost of independent beer to the consumer.  

On behalf of our members, we aren’t asking for free ride.

What we are asking for is a good faith review of the excise system that balances responsible consumption of alcohol by the majority of Australians.

You can watch the start of the discussion on excise reform HERE.