Bundaberg Rum launches crusade against Albo’s ‘fun tax’

Iconic Queensland company Bundaberg Rum will lead a campaign against the federal government’s soaring spirits tax – labelling it a handbrake on Australians “having fun”.

Iconic Queensland company Bundaberg Rum will lead a campaign against the federal government’s soaring spirits tax – labelling it a handbrake on Australians “having fun”.

The federal tax changes twice each year with inflation, which resulted in Australians paying $100 per litre of alcohol last August, with another rise due February.

Distillers argue the tax – 63 per cent of the cost of a 1L bottle – is holding back small and medium businesses from creating a national spirits industry to rival wine.

Bundaberg Distilling will lead a statewide advocacy campaign, targeting key federal seats, advocating for the Albanese government to freeze the “unbearable” increases it said was crippling businesses and adding to rampant cost of living pressures.

Bundaberg Distilling Co Chair Amanda Lampe called for the government to pause the tax hikes while the system was reviewed.

“We always preach a message of moderation in relation to alcohol but this tax is also stopping people from having fun, getting together and having a drink in a sensible way,” she said.

“The way this tax system was conveyed, it just kept going up and up and there is no end in sight … somebody’s got to do something.”

Spirits industry figures note it supports 52,900 jobs and contributes $11.6bn to the economy each year, while the tax delivers $5bn in revenue to federal government coffers.

Ms Lampe said Bundaberg Distilling had lobbied the Morrison and now Albanese governments “on behalf of the spirits industry” without success.

“Have a pause, have a freeze, this is something that is in your control,” she said.

“It’s a really good way to just take the pressure off and then we can all have a discussion.”

Ms Lampe argued the tax freeze could help the spirits industry grow towards rivalling Australia’s $45.5bn wine industry.

“In terms of potential, it’s huge, but there are loads of small businesses, from rum distilleries in Queensland to Tasmanian whiskey distilleries that are feeling the pressure,” she said.

“We’ve got an opportunity to create a new industry here … this tax system is really penalising and inhibiting that.”

Australian Federal Treasurer Jim Chalmers in his office at Parliament House in Canberra. Picture: NCA NewsWire / Martin Ollman

Ms Lampe said the spirits tax was also hurting tourism, with prices for drinks consistently rising in “high end cocktail bars” or for “around a campfire”.

Australia is the third-highest spirits taxing country in the world, behind only Iceland and Norway.

Australian Distillers Association chief executive Paul McLeay argued the tax was a “handbrake” on growing small and medium-sized distillers.

“Instead of reinvesting in their business and employing people in the regions, they’re sending it to the tax man,” he said.

“When the government says they want a manufacturing future in Australia we say we’d like to help, but stop taxing us to death.”

Mr McLeay said there was an “unbearable” disparity between the United States, where the tax is $11 per litre, and Australia’s $100 per litre.

A spokesman for Treasurer Jim Chalmers suggested the automatic biannual increases wouldn’t change.

“This is the usual, legislated, automatic indexation change that happens twice a year under governments of both persuasions and it’s not a new decision of this government,” he said.

“We listen respectfully to ideas put to us but these have to be weighed up against other priorities and within the budgetary constraints we inherited from the Coalition including a trillion dollars of Liberal debt.”