Alcohol Taxes and Craft Beer
The old saying goes ‘In this world nothing can be certain except death and taxes.’ At Beer Cartel we don’t like to get too political but we do like to spread the knowledge of an industry we love. Here is a bit of information on what is often seen as a very dry and boring subject!
The alcohol taxation system in Australia has become complex and favours some industry sectors more than others. As a result alcohol taxation is currently under review. Some interesting facts about alcohol taxes in Australia:
-Australia has some of the highest alcohol taxes in the world compared to other craft beer centric countries like the USA and New Zealand. Beer is the second highest taxed alcohol in Australia, second only to spirits.
-The current alcohol taxation system has over 14 different tax rates/types applied dependent on alcohol type (beer/wine/spirits/cider), volume (litre) and ABV (% alcohol).
-Beer has two automatic excise increases each year (calculated using CPI) and also has GST applied to it, yes a tax on a tax. This legacy system has been in operation since its inception 30 years ago. These automatic increases to beer excise occur on February 1st and August 1st each year.
-You pay more excise on beer (for the same volume) in bottle format than you do for a 50 litre keg – a result of the introduction of the GST.
-Brewers must pay excise prior to the beer leaving the brewery, the only exception being those that store their beer in a bonded warehouse.
-Legislative changes made in 2012 allow brewers to access a refund of up to $30,000 on the excise paid. While this was welcomed, it pales in comparison to the $500,000 refund that wine producers are able to access. The refund is not accessible to those that do not own their own breweries, e.g. gypsy brewers.
While we understand that beer will always be taxed, and that’s a good thing as revenues raised are used to drive awareness of safe consumption, a fairer system would only further assist the growth of this exciting industry we all love.