Campaign to cut excise is a lifeline to on-premise

February 24, 2022
By Ioni Doherty

The Australian Hotels Association and Brewers Association continue to campaign for a cut to the increased excise on draught beer which came into effect on 1 February.

The AHA and Brewers Association say their campaign to cut the tax is about supporting hospitality, pubs and clubs, many of which are small businesses. It is about supporting venues that have endured the most difficult trading period of our time.

Brewers Association CEO John Preston said, “This is all about helping hospitality rebuild and giving beer drinkers a break from tax increases.”

Through the pandemic, on-premise businesses have lost $2b in beer sales alone.

AHA National CEO Stephen Ferguson said, “We understand the Government is currently considering it and we welcome the support of backbenchers in particular who realise what this means for everyday people struggling with the cost of living.

“This is a hidden tax which impacts beer drinkers in the front bar, a tax on socialising. It’s important to remember we are talking on premise only here – we are not seeking a free for all with cheaper packaged alcohol from supermarkets.”

The organisations say that cutting the excise will reduce the cost of a beer by 30-40 cents and save brewers an estimated $150 million in tax.

“We believe a 50 per cent reduction in draught beer tax is a responsible and effective way for the Federal Government to give beer drinkers a break after 35 years of tax hikes and provide much needed support for pubs and clubs,” said Mr Preston.

“We’ve had some great support for this proposal from MPs and we feel the message is getting across to Canberra on how Australia’s fourth highest beer tax in the world impacts beer drinkers and their locals. We’re hoping that this upcoming Federal Budget will bring some good news for the sector.”

At the same time, more than 80 community leaders and organisations have signed an open letter to Treasurer Josh Frydenberg calling on the Government to abandon any plans to cut the price of alcohol because of the risk to the health, wellbeing and safety of Australians.

In the letter, community leaders said that any reductions to the price of alcoholic products would be devastating, particularly at a time when we’re seeing increases in alcohol harm.

FARE CEO, Ms Caterina Giorgi, said, “Alcohol lobbyists have been pushing to cut alcohol taxes for decades. Now they are using the cover of the pandemic to push their agenda.

“At a time when alcohol harms and demand for health and community services are rising, it makes no sense to cut alcohol taxes, which will increase alcohol harm.”

Brewers Association John Preston disagrees. He says that community pubs provide an essential service and play a central place in people’s social lives, particularly in regional areas. The pub is an important part of the contact network.

Mr Preston said, “We believe this measure is moderate and targeted to get people back to pubs and clubs. And it aligns with the government’s alcohol strategy. Getting people out of their homes and back into the community can only be a good thing.”

The Federal Budget will be announced on 29 March.

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