Australians could see the price of their beers and spirits go up from next week as industry leaders call on the federal government to pause its “out of date” excise tax.
Breweries are currently forced to pay about $50 per litre of beer while distilleries pay about $100 for the same amount of spirits.
With the biannual indexation on February 1, the industry fears the tax rise will leave Australians paying more and manufacturers exporting product overseas.
Spirits and Cocktails Australia chief executive Greg Holland urged the government for an immediate freeze on the excise tax, which he said was the third highest in the world, behind Iceland and Norway.
“This latest increase … it’s going to have a massive effect not only the manufacturers but the consumers,” he said.
“This is just another contributing factor to the cost of living for hardworking Australians.”
Holland said spirits were now being exported to New Zealand, where it’s cheaper to buy Australian products because prices have become too expensive at home.
“The worst-case scenario is happening now, this just keeps on going and going, there’s no stop,” he said.
“Every six months it keeps going up.”
The Australian Distillers Association, on behalf of the 600 distilleries it represents, also joined the call for a freeze.
“This unbearable level of tax means that when the tax goes up next week, under the current cost of living crisis, the producers have to make a decision,” chief executive Paul McLeay said.
“Do they put up the price … or do they lay off staff?”
McLeay said tax was at an all-time high and, while some distilleries will increase the price of spirits, others would be forced to lay off at least one full-time worker.
“The policy is from 40 years ago … when there were only two distilleries,” he said.
“There are now 600 that are impacted from this out-of-date policy.
“When it increases, the government expects us to pass on the cost but the customer isn’t willing to accept the cost.”
Both groups, along with the Brewers Association of Australia, are calling for a sit-down with the federal government to discuss fair ways to pay tax and alleviate pressures from the twice-a-year increases.
