A week on from their poorly-received election promise to increase the excise tax rebate for brewers – described by the Independent Brewers Association (IBA) as "far too little, far too late" – Labor have upped their offer.
The plan is to pause excise tax rises on draught beer for two years if reelected in this year's federal election.
“Freezing the excise on draught beer is a common sense measure that is good for beer drinkers, good for brewers and good for pubs," the Prime Minister said in a media statement.
Excise tax, which rises twice per year, every year in line with CPI, has been a major bone of contention for the country's small brewers and distillers for years, generating as much debate and emotion as the tap contracts that close off market access for indie producers. Now tagged the "beer tax" and building as a potential election issue as coverage has escalated in recent months, it is one of the major drivers of the rising cost of beer and the challenges facing brewers, publicans and retailers.
In 2023, The Crafty Pint explored the exploding costs involved in brewing beer, with excise tax cited as one of the major factors driving beer prices higher.
In response to the announcement, the IBA said the decision was a "modest step in the right direction" but urged for more to be done to support independent beer.
"We, of course wish that these were more immediate and applied to all beer as we know they will not be enough to prevent some of the smallest independent breweries from closing," the statement said.
Just last 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, 2026. 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.
At the time, the IBA said they welcomed any reform that would address the "unfair taxation system that is hurting Australian owned brewing businesses and their customers", but that the tax break would take too long to come into law for it to benefit a beer industry that is struggling now.
If Labor are reelected, the two-year freeze would come into place from August – the date of the next scheduled bi-annual hike.
The government's media release is immediately below, followed by the response from the IBA.
Media release: Albanese Labor Government to freeze draught beer excise
The Albanese Labor Government will freeze the indexation on draught beer excise for two years, in a win for beer drinkers, brewers and hospitality businesses.
Indexation is applied twice a year under arrangements in place for decades. While the February indexation accounted for a small percentage of the cost of a pint, this change will help pubs and their patrons.
We will freeze indexation on draught beer for two years from the next indexation date of August 2025.
This will take pressure off the price of a beer poured in pubs, clubs and other venues, supporting businesses, regional tourism and customers across Australia.
The Government will consult with the sector on the implementation of this measure.
This announcement comes on top of new tax relief announced last week for Australia’s distillers, brewers and wine producers.
Currently brewers and distillers get a full remission of any excise paid up to $350,000 each year.
We will increase the excise remission cap to $400,000 for all eligible alcohol manufacturers and we will also increase the Wine Equalisation Tax producer rebate cap to $400,000 from July 1 2026.
Quotes attributable to Prime Minister Anthony Albanese:
“My Government is building Australia’s future and to do that we need to support our small and medium local businesses to thrive.
“Freezing the excise on draught beer is a common sense measure that is good for beer drinkers, good for brewers and good for pubs.”
Quotes attributable to Treasurer Jim Chalmers:
"This is a modest change but will help take a little bit of the pressure off beer drinkers, brewers and bars."
Media Release: Albanese’s commitment to 2-year freeze on the bi-annual excise tax increase is a modest step in the right direction
This morning, Prime Minister Albanese announced a freeze on the bi-annual indexation on draught beer excise for two years commencing in August 2025.
We echo the comments from Treasurer Chalmers that “this is a modest change but will help take a little bit of the pressure off beer drinkers, brewers and bars.”
The Independent Brewers Association (IBA) welcomes any change that will provide some relief for our Australian owned small manufacturers at a time when 48% of independent breweries have said they are struggling to retain profitability.
For many years, the IBA have been advocating for a freeze on the excise tax for ALL beer. Today’s announcement supports a 2-year freeze on draught beer and only after 84 successive increases.
Many independent breweries do have venues and tap rooms that provide welcoming, family friendly, environments to enjoy a locally made pint, and we appreciate the support for those businesses.
Having a venue where you own your own taps is one of the most viable models for Australian-owned breweries because they struggle to get access in pubs and clubs due to the market power of the two foreign owned breweries.
“The commitment to freeze the tax on draught from August 2025, coupled with the proposed increase the remissions cap by $50,000 from 1 July 2026 are both steps in the right direction, as is the opportunity for consultation and open dialogue.
We, of course wish that these were more immediate and applied to all beer as we know they will not be enough to prevent some of the smallest independent breweries from closing.
It is clear that Prime Minister Albanese is looking to find ways to provide relief and we thank him for that – but at the same time, look forward to a commitment to more meaningful change to our unfair alcohol tax regime and initiatives that would support Australian-owned small brewing businesses” say Kylie Lethbridge, Chief Executive Officer.
If you want to help #saveindiebeer then don’t forget to get involved in our Campaign here.
