The Independent Brewers Association (IBA) has called an election commitment by the Labor government regarding excise tax "far too little, far too late" as the group continues to encourage brewers and voters to push politicians for change.
On Saturday, Prime Minister Anthony Albanese announced the government would increase the excise remission cap to $400,000 for brewers, distillers and winemakers from July 1 next year. That $50,000 increase in the remission cap available to alcohol makers follows the then-Liberal government introducing a $350,000 excise remission cap in 2021. For some time, the IBA has advocated for the excise refund to be indexed in line with inflation so that the real value of the tax break doesn't diminish over time.
In a media release, the IBA said that while the organisation welcomed any reform that would address the "unfair taxation system that is hurting Australian owned brewing businesses and their customers", the tax break would take too long to come into law for it to benefit a beer industry that is struggling now.
"This means our small Australian-owned brewery businesses, who already contribute approximately $3.53 billion to the nation’s economy annually, need to brace for a further two excise tax increases before this promise is delivered," the media release stated.
The IBA also expressed disappointment that a long-awaited report by The House Standing Committee on Industry, Science and Resources Inquiry into food and beverage manufacturing didn't directly address Australia's excise system. Instead, the report, which was released on February 20, recommended that another inquiry should be held into Australia's alcohol tax system.
Speaking to The Crafty Pint, IBA CEO Kylie Lethbridge said the government didn't have to wait to be re-elected to provide some level of support for the industry.
"They could have given us some help now," Kylie said.
If there's a positive for independent brewers as the country prepares for an election - which has to be held on or before May 17 - it's that the issues facing breweries as they struggle to survive, enter voluntary administration, change ownership, or in many cases close, are receiving widespread attention from both mainstream media and voters.
A recent video created by the Sunshine Coast's Blackflag about how beer's "secret ingredient" is tax, was shared more than 800 times and had more than 100,000 views while leading to interviews on The Today Show, 7 News Sunshine Coast, the Sunshine Coast Daily and Channel Ten News. The craft brewer also used that momentum to encourage their database to talk to those politicians who represent the region, which has dubbed itself the country's "craft beer capital".
Kylie says the IBA's focus with their Campaign 2025 strategy is to provide the beer industry and its supporters with assets to encourage them to talk directly with politicians and drinkers about how excise tax needs to change.
"They have been great in repurposing the assets we're giving them or making their own," Kylie says. "Like with Blackflag or many others, we're seeing examples of that every day."
In the lead-up to the election campaign, the IBA will continue to add more details and data about excise's impact on beer prices and the harsh realities of running a beer business in the current climate.
"This is the time to tell the people who you're voting for what you want them to do," Kylie says.
As messaging around the reasons behind the rising cost of beer, Australia's twice-yearly excise increases, and brewery closures continue to cut through, Kylie adds that the calls to save indie beer need to continue building momentum.
"It's working," she says. “We need everyone - beer drinkers and breweries - to talk to MPs about how they're local and that beer is too expensive. Politicians from all parties have to listen to you as voters."
The IBA's media release and the Labor announcement can be found below. Campaign 2025 details and assets can be found here; beer drinkers are encouraged to sign up to receive further updates.
IBA Media Release: Labor’s election commitment on tax breaks is far too little, far too late
Over the weekend, the Prime Minister committed to providing tax relief for Australia’s distillers, brewers and wine producers by increasing the excise remission cap to $400,000 (from $350,000).
We welcome any reform that will address the unfair taxation system that is hurting Australian owned brewing businesses – and their customers.
While on the surface this looks to be a generous gesture by the Labor government as they head into an election – unfortunately, the fine print indicates that this change would not apply until 1 July 2026.
This means our small Australian owned brewery businesses, who already contribute approx. $3.53 billion to the nation’s economy annually, need to brace for a further two excise tax increases before this promise is delivered. AND the Albanese government must be re-elected first.
The challenges our industry is facing have garnered widespread attention because in a cost-of-living crisis a beer at the pub, or over a backyard BBQ is becoming unaffordable.
This pre-election commitment comes just days after the release of the long-awaited report from The House Standing Committee on Industry, Science and Resources Inquiry into food and beverage manufacturing in Australia titled Food for Thought: The Opportunities and Challenges for Australia’s Food and Beverage Manufacturing Industry.
The report noted that approximately 40% of the submissions received were from the alcohol industry with a focus on the rates of taxation and the effects on the industry. You can read the IBA’s submission here.
Unfortunately, rather than tackling the direct link between the unfair and ever-increasing taxation on small brewing businesses and their ability to invest in productivity and innovation – the Committee concluded that those issues were too difficult and, only weeks before an election, have recommended another inquiry.
In August 2024, in response to the motion from Pat Conaghan MP, Federal Member for Cowper (Nationals) calling on government to develop a sensible package of excise tax reforms, Tania Lawrence MP (Labor) said:
“The Labor government is working to understand these issues across the sector, hence the present inquiry into food and beverage manufacturing by the House Standing Committee on Industry, Science and Resources. The challenge before us is to chart a course that encourages healthy growth and competition. … Fortunately, the review that is underway will provide an evidence- based approach. Of the 121 submissions received to date, the majority, 68, are from wine, beer and spirits producers and businesses impacted by the excise. I’m confident the review will frame their recommendations—and get them right—to lead to strong and sustainable growth and to add value to the economy for Australian consumers and businesses of all sizes.
Rather than do as Tania Lawrence MP foreshadowed, and provide meaningful actions for small Australian owned breweries, the Food for Thought Report delivered a recommendation for yet another inquiry into the alcohol industry.
As far back as March 2024, the House Standing Committee for Economics Better Competition, Better Prices Report noted that, “Australia has one of the most restricted beer sectors in the world, with two large foreign-owned corporations dominating beer supply, and two large companies dominating the retail beer sector”.
Assistant Competition Minister Andrew Leigh, is also on record saying that the Better Prices, Better Competition Report “showed there is plenty of reason for the Australian Competition and Consumer Commission to investigate the beer industry.”
Labor have more than enough evidence from their own inquiries to demonstrate that unless they take immediate action more Australian owned breweries will close and more jobs will be lost.
Unfortunately, they have decided to continuously kick the can of responsibility down the road.
Recommending another inquiry and promising a tax break 18 months into the future just before an election is a cop out. The Labor party are still in Government and if they really wanted to – they could show leadership today.
It’s no surprise then that beer made by an Australian owned brewery is becoming unaffordable and frankly that’s un-Australian.
If you want to help #saveindiebeer then don’t forget to get involved in our Campaign here.
Labor Government Media Release: The Albanese Labor Government will provide tax relief for Australia’s distillers, brewers and wine producers.
Currently brewers and distillers get a full refund of any excise paid up to $350,000 each year. The Government will increase the excise remission cap to $400,000 for all eligible alcohol manufacturers. The Government will also increase the Wine Equalisation Tax (WET) producer rebate to $400,000.
Adjusting the taxation arrangements will back an important local industry as well as supporting regional tourism, investment and job creation. Currently around 1,500 brewers and distillers and 3,000 wine producers access these tax incentives.
The proposal will apply from 1 July 2026.
In addition to the tax relief, the Australian Trade and Investment Commission (Austrade) will be providing Australian distillers, brewers and wine producers with additional support to help them grow their exports in high priority overseas markets.
This support includes the opportunity to join in trade missions, expert advice and connections to help our small and medium size exporters tap into fast growing markets, including in Southeast Asia and beyond.
The tax relief is estimated to decrease tax receipts by $70 million over five years from 2024-25.
Will Ziebell is a history graduate who knows more about The Wire than he does about beer. He was awarded the AIBA Best Media trophy in 2018 and in 2024; HBO have told him to please send his fan mail elsewhere. He can be found on Instagram, Twitter and TikTok.
The beer(s) or moment(s) that turned you on to good beer:
Spending time living in the UK (and backpacking across Europe) when I was 21 certainly gave me a better understanding of the beer and different styles of the world. But I'd say it was a holiday to the High Country a little while later when lunch and a tasting paddle at Bridge Road Brewers created an obsession with Australian breweries and locally made beer.
You've got three beers to turn someone else on to good beer; what are they and why?
-
Boatrocker's Miss Pinky: It's a raspberry-packed Berliner Weisse that neither looks or tastes the way many people conceive of beer.
-
Bad Shepherd Hazelnut Brown: A luscious mix of chocolate and hazelnut that can appeal to the sweet tooth within us all.
-
Stone & Wood Pacific Ale: As the father of my oldest friend once said to me: "It's the perfect refreshing pint that smells like they've loaded it with the God's herb."
The last beer you enjoyed:
Garage Project's DFA while sitting at the bar at Miss Moses as the sounds of The Rolling Stone drifting in the background.
Three things that represent you:
- Bruce Springsteen
- Ken Burns
- The State Library of Victoria
