The ATO has announced that alcohol excise duty rates will increase from Monday, 1 February and that excise arrangements for the sale of takeaway beverages and production of hand sanitiser will return to normal.
A full list of excise rates for beer and spirits is available here. Wine is not an excisable beverage. It’s subject to wine equalisation tax (WET).
- Companies are reminded to:
- Apply the correct rate to product delivered before and after 1 February
- Lodge for every period, even if no goods are delivered for the period (when holding a periodic settlement permission)
- Ensure refunds, remissions and drawbacks are correctly claimed
- Keep complete and accurate records
Normal excises and permits return for takeaway and sanitiser
From next Monday, licensing and permit rules relaxed at the onset of the pandemic will be re-introduced
Takeaway alcoholic beverages
As bars and clubs shut down in March last year, the ATO suspended excise requirements for:
- repackaged duty-paid kegged beer for takeaway sale in sealed containers (such as growlers) and
- used duty-paid alcoholic beverages to make ‘cocktails’ for takeaway sale in sealed containers.
This relaxation was intended to support businesses and trade, allowing flexibility for alcohol repackaging under specific situations that would normally have required an excise manufacturer licence and payment of excise duty.
After 31 January 2021, vendors who wish to continue repackaging alcohol for sale in takeaway, sealed containers need to apply for the appropriate excise licence and permissions.
The ATO also suspended relaxed and streamlined the excise licensing and permit rules relating to the production, supply and use of alcohol for hand sanitisers.
This enabled support for increased production and supply of hand sanitiser.
From 1 February 2021, these excise licensing and permit rules will return to normal.
Distillers with an existing excise manufacturer licence to produce or distil spirits can produce hand sanitiser and report it by using the free-rate tariff item on their excise return.
However, an ATO-issued concessional spirit permit is required.
Other excise-licensed entities (for example, breweries) that want to produce their own spirit for the purposes of producing hand sanitiser, need to apply for an amendment to their licence AND an ATO permit to use the spirit for the purposes of producing hand sanitiser.
Once approved, spirit produced for the purpose of producing hand sanitiser must be reported using the free-rate tariff item on the ATO excise return.