An outdated beer tax that taxed craft brewers 40% more for using smaller kegs will be axed in the federal budget.
The current two-tier tax system means draught beer sold in 50 litre kegs are taxed at $34 a litre, but beers in kegs under 30 litres are slugged $49 a litre.
Craft brewers prefer using smaller kegs because it ensures fresher beer.
“This is unfair for smaller brewery businesses,” Treasurer Scott Morrison said in a statement. “The extra help to craft brewers and distillers will drive competition in a sector currently dominated by large domestic and multinational brewers, opening the door to new products and will likely put downward pressure on prices.”
The federal budget will extend concessional draught beer excises to smaller kegs, and increase the amount beverage companies can claim back.
Alcohol manufacturers can currently claim a refund of 60% in the excise duty paid on beer and spirits of up to $30,000 a year.
This will increase to $100,000 from July 1 next year, and apply to all brewers and distillers for the first time.
Opposition frontbencher Penny Wong pointed out the the coalition had pinched the idea from her Labor colleague Anthony Albanese.
“I think it’s a good idea, and it’s Albo’s idea,” Senator Wong told the Nine Network.
Albanese described the “common sense change” as a victory for people power.
“Craft brewers deserve to operate on a level playing field with the big multinational beer brands,” he said. “And beer drinkers should pay the same regardless of what brand of beer they enjoy.”
Last year, Albanese (pictured above with Inner West Brewers Association) introduced a bill to Parliament calling for an update on policy, excise and planning rules to boost the craft brewing industry.
He said: “I do so in support of those Australians who are currently employed by the more than 400 craft brewers around Australia. The craft brewing industry is a job creation powerhouse, but if we get the policy settings right it could generate even more jobs not just in our capital cities but also in our regional communities.has been campaigning for
There are about 380 craft brewers across Australia employing about 2400 people.
The Independent Brewers Association also launched an excise campaign last year asking the Federal Government for a fairer tax system.
IBA chief Chris McNamara told the Herald Sun that high and complicated excise duty arrangements were hampering the sector’s further growth.
He noted that current excise rates were the key constraint to growth identified by breweries on an industry-wide basis, with 53% of brewers the IBA surveyed identifying this factor.
