Sunshine Coast craft beer: Brewer refuses to lift prices despite tax hike

A leading Sunshine Coast craft brewer is refusing to lift the price of beer despite ‘exorbitant’ freight costs and a biannual tax increase that cut profit margins.

A leading Sunshine Coast craft brewer has called on the federal government to cut its “exorbitant” freight costs on Australian-owned companies in wake of yet another tax rise on beer.

A 2.1 per cent biannual tax rise comes into play on Tuesday which takes the full strength draught beer rate to $36.98 per litre of pure alcohol for the next six months.

Hinterland beer baron Matt Jancauskas said medium-sized breweries like his were being impacted each time the tax increased, however, he has refused to pass the cost onto his customers.

The founder of popular Brouhaha Maleny and Baringa breweries said businesses of similar sizes to his were being hit the hardest for their success.

Mr Jancauskas said it was impossible to match the production rates of multinational or international companies yet businesses like his were slapped with the same freight charges.

Brouhaha Brewery founder Matt Jancauskas says the tax hike is unfair. Picture: Annette Dew

It comes after the Australian Hotels Association, Clubs Australia and the Brewers Association joined forces to call for urgent action to cut the draught beer tax.

Mr Jancauskas said each time the tax increased it meant the cost of production went up.

“It’s becoming ridiculous. If people realised what percentage brewers actually take home, after you pay for labour, ingredients, packaging, overheads, it’s not much. The margins are very scarce,” Mr Jancauskas said.

“It’s really high and it’s a bit unfair that we are all paying for it. It needs revision.

“At least the Australian-owned companies who have to compete with international brands should get better excise freight costs, which are exorbitant.”

Mr Jancauskas said nearly 50 per cent of each beer was hit with a tax from either GST or the excise tax.

Sunshine Coast Hotels managing director Scott Armstrong said businesses like his Brightwater, Parklands and Baringa taverns were paying each time the tax increased.

Mr Armstrong said brewers and publicans were not pleading for a handout, but for a decrease on the tax burden.

Queensland Hotels Association chief executive Bernie Hogan said slashing the beer excise tax by half would mean a large pub could save up to $3000 a week.

Sunshine Coast Hotels managing director Scott Armstrong says brewers are not pleading for a handout, but for a decrease on the tax burden.

Mr Jancauskas said he applauded the introduction of a tax rebate which came in July 2021 but said it only had a positive impact on smaller breweries.

He said the hike came with the hospitality industry still reeling from the Omicron wave.

“Freight is ridiculous, the delays on produce, it’s just another stress and another cost that has to be worn by us,” he said.

“You can’t just put it back on the customer. We haven’t changed our prices in years.”