In anticipation of the forthcoming Federal Election, Prime Minister Anthony Albanese has announced a proposal to freeze taxation on draught beer served in pubs. If Labour is re-elected, the biannual adjustment of the draught beer excise will be suspended for two years. The latest excise increase of 2 to 3 per cent took effect on February 3.
Treasurer Jim Chalmers described the pausing of the tax as a “modest change” that would alleviate some financial burdens on beer drinkers, brewers, and bars alike. Albanese labelled the decision a “common sense measure,” emphasising the importance of supporting small and medium local businesses in Australia. He asserted that by freezing the excise on draught beer, the policy positively impacts consumers, breweries, and pubs.
However, the measure has faced criticism from spirits producers and the wider distilling industry. Greg Holland, the chief executive of Spirits & Cocktails Australia, argued that there was no valid justification for favouring draught beer over spirits, noting that the tax on spirits is already significantly higher. He claimed the freeze deemed discriminatory, as it advantages beer enthusiasts, brewers, and establishments serving beer over those in the spirits market.
Australian Distillers Association’s chief executive, Paul McLeay, expressed disappointment at what he perceived as government favouritism towards the beer sector, particularly overshadowing any positive aspects from recent tax adjustments for spirits producers. This ongoing debate highlights the complexities surrounding alcohol taxation, which serves as a significant revenue source for the government. With the election on the horizon, the government’s alcohol tax policies are likely to remain a topic of contention as they navigate stakeholder interests and public sentiment.