The Independent Brewers Association have expressed "extreme disappointment" following the latest federal budget, due to a lack of excise relief and the categorisation of craft beer as a "revenue line".
Below is a media release from independent beer's peak body.
Media Release: Australia’s independent brewers are more than a revenue line
“The Federal Government may only think of our members as just a “revenue line” but we are much more than that. And we are not going away.” Says Callum Reeves, Board Director, Independent Brewers Association, and owner of KAIJU! Beer.
In its 2024/25 budget announcement the Federal Government have chosen not to take any steps to slow down the ballooning of Australia’s excise tax and demonstrated that they don’t care about small businesses or about the cost of a pint for the average Australian.
The governments of the United Kingdom, Japan and most recently Canada, have all recently supported some form of relief for their beer manufacturers – so we know that it is possible and that other countries care about the current economic environment for small businesses, and for consumers. But not here.
Australia’s 600+ independent brewers are extremely disappointed that the Government have decided to marginalise their role to simply being revenue generators.
Our members contribute to the cultural fabric and economic vitality of communities throughout Australia. They are supporters of Aussie farmers, hubs of innovation and job creation, with tourism experiences that enrich our nation's beverage landscape through locally produced beers.
“Stopping excise from increasing, if only on a temporary basis would have enabled our breweries to stem the tide of cost-of-living pressures, retain employees or even afford the ingredients necessary for crafting a quality product.
We were told that our calls for help were being heard, were granted the opportunity to inform many Members of Parliament about the challenges in the Australian beer market and provided them easy to implement and cost-effective solutions. We are very disappointed the federal government did not see fit to use its power to help the small businesses that this nation was built on.” Said Kylie Lethbridge, Chief Executive Officer of the IBA.
Addressing excise might appear insignificant, but for the smaller breweries in Australia, the cost disparity between producing a single can of beer for us versus a large multinational business is substantial.
If our Federal Government are not interested in offering a less encumbered regulatory framework for our industry then it is our view that they must, at least ensure that independent breweries have fair access to market.
In March 2024, the House of Representatives, Standing Committee on Economics released its report “Better Competition, Better Prices” on the inquiry into promoting economic dynamism, competition and business formation.
In that report, the Committee acknowledged what we have been saying for some time - “that Lion and CUB exercise enormous market power in the beer sector, with a combined 85% market share and margins higher than in the alcohol retail sector.” The Committee found that “there appears to be evidence of high margins in the beer brewing sector which may indicate excessive market power. This would contribute to the high cost of beer for consumers.”
Now we are asking for action based on their own findings. The Australian Government could easily claw back this perceived lack of support by directing the Australian Competition and Consumer Commission to conduct an inquiry into the Australian beer market.
“Our members are people too and our issues cannot keep being put on the backburner. With every liquidation, voluntary administration and story of struggle we are seeing peoples’ lives impacted and jobs stripped from regional communities… it's simply not sustainable,' concluded Kylie.
