Big Shed Brewery owner Jason Harris blames alcohol excise for industry crisis, as crossbencher Frank Pangallo calls for tax freeze

Independent MLC Frank Pangallo says going out for a beer will soon be an “unaffordable luxury” if we don’t put a freeze on alcohol tax. Do you agree with him?

Independent state upper house member Frank Pangallo accused the federal government of being “drunk on alcohol excise” and said going out would become an “unaffordable luxury” unless the twice-a-year hike is temporarily frozen.

He urged Premier Peter Malinauskas and other state leaders “to have common sense discussions with their federal counterparts before it is too late”.

“The excise is a massive money earner, but it cannot keep rising without devastating consequences,” Mr Pangallo said.

Independent MLC Frank Pangallo. Picture: NCA NewsWire / Brenton Edwards

“They are changing the culture of our pubs and nightclubs as people seek alternatives to being able to socialise and have fun without breaking their bank balances.”

Mr Pangallo also said further hikes could lead to the production of cheap and potentially dangerous home-brewed spirits.

A state government spokesman did not comment on whether the Premier had made representations to the federal government about the excise.

However, he said the tax “has always been set by the Commonwealth and any changes are a matter for consideration by the federal government”.

“The state government has been widely recognised for its efforts stimulating and supporting the food and beverage sectors, which suffered so significantly during Covid restrictions,” the spokesman said.

One of the biggest names in hospitality said the industry is being “taxed into oblivion”, as the Premier faces calls to do more to curb the federal government’s crippling alcohol excise.

Earlier this year, The Advertiser reported on a string of bars and restaurants shutting their doors as bills skyrocket and consumers tighten their wallets.

Nine high-profile city venues have already closed permanently in 2024, while craft brewery Big Shed went into voluntary administration two weeks ago.

Co-owner Jason Harris opened his Royal Park site in 2012 employing nearly 50 people, but said under the current tax regime “you’d have to seriously consider starting a brand now”.

“For every pint, you’re looking at 90 plus cents on tax,” Mr Harris said.

“It’s been a historic problem, but the cost of living pressures and inflation have ratcheted it up.”

Big Shed Brewery co-owner Jason Harris said the alcohol industry is being "taxed into oblivion" by the federal government's alcohol excise. Picture: Supplied

On February 1, venues started paying the federal government nearly 60 cents more tax on a keg of light beer, or $32.33 per keg, and an extra $1.80 on spirits, or $101.85 per litre.

Mr Harris said he pays roughly $91 tax on a keg sold for $340 wholesale because of the higher alcohol volume.

“You’ve got major brewers with staff and accountants trying to calculate these taxes, and then mum and dad brewers who have to figure it out themselves,” he said.

“Businesses like mine were started on passion, but now they’re being taxed into oblivion, and I don’t know how much longer they can weather the storm.

“A lot of small businesses are doing it tough, but all you have to do is go in and buy something to make a difference.”

According to the Australian Brewers Association, Australia’s alcohol excise is the third-highest in the world, netting the federal government more than $8 billion revenue in 2022.