‘Greedy’: Aussies fuming over new beer slug

Australia’s independent consumer watchdog has made a “pre-emptive strike” amid the escalating stoush over the nation’s beer tax which brewers say is an “unfair” burden on the sector.

Brewers have hit back at Treasurer Jim Chalmers’ for involving Australia’s independent consumer watchdog in a “pre-emptive strike” amid the escalating stoush over the nation’s beer tax, which they say remains an unfair burden on the sector.

Industry groups were shocked to receive letters from the Australian Competition and Consumer Commission (ACCC) last week warning them of their responsibility to not misinform customers about the impact of the twice-yearly tax hike just days after Mr Chalmers had written asking the watchdog to investigate his concerns that beer drinkers could be misled.

The Treasurer had highlighted how February’s excise indexation amounted to less than one cent per pint or schooner, and about five cents per slab of beer, but brewers say the focus of their campaign was on the overall impact of the tax.

Kylie Lethbridge, CEO of the Independent Brewers Association.

Independent Brewers Association chief executive Kylie Lethbridge said the ACCC had not been able to provide any examples of alcohol companies misinforming consumers and did not expect the sector would “take the foot off the gas” in its fight for fairer tax treatment.

“We’re very disappointed with the Treasurer’s pre-emptive strike … which was very much out of the blue,” she said.

“All we’re asking for is some temporary help, and a longer term look at the taxation framework because it is unequal and unfair (compared to the wine industry).”

Ms Lethbridge said brewers wanted a temporary freeze on the excise so they could “recover” from the hikes during higher inflation years, and for a rebate scheme that helps smaller operators to be indexed as it’s currently diluting over time.

Worker Maddy Woolley at Young Henry's Brewery in Newtown. Independent brewers are hitting back at the government's insistence the beer excise tax isn't a major cost factor as the indexation was only minor this time. Picture: Jonathan Ng

The escalating row comes as new polling of marginal seats commissioned by the Brewers Association of Australia (BAA) found two in three voters support a reduction in the excise, with only about 17 per cent opposed.

BAA chief executive John Preston said beer drinkers “know all too well” that the country had the third highest beer tax in the world.

“While each increase is relatively small it ignores the fact that this is the 84th increase,” he said. “Every time someone buys a slab they pay $20 in excise direct to the federal government and then they pay GST on top.”

Beer drinkers responded to the story by calling Labor “greedy” and “gutless”.

“Greedy, short-sighted rip-off; hitting both the consumer and the hospitality industry - employment and business survival? Dutton could front this head-on, I guarantee there would be a lot of votes to be gained,” one comment reads.

“It’s an unfair tax in the first place, but how utterly gutless is Chalmers to use the clout of the ACCC to shut the Brewers up,” wrote another.

Some of the commenters called for more transparency from the Government.

“Where is all the money going now that beer is so expensive. A breakdown of the cost would be great so we can see if we the consumers are getting ripped off again.”

Federal Treasurer Jim Chalmers. Picture: NewsWire / Martin Ollman

Richard Adamson, head brewer at Young Henrys – an independent brewery based in Anthony Albanese’s inner western Sydney electorate – said the excise system designed in the 1980s was “no longer fit for purpose”.

“We’re getting this crazy situation where beer is just getting out of reach of the average consumer,” he said. “Since 2022 (the beer excise) has gone up 10.5 per cent.”

Mr Adamson said the “two speed taxation system” where wine falls under an equalisation tax as a percentage of wholesale prices, while beer and spirits taxes are indexed twice a year in line with inflation, was unfair.

“The disparity now is so great that, you see wine products ridiculously cheap, and beer and spirits getting out of reach of the average person,” he said.

Mr Adamson said independent brewers were particularly hit hard by rising input costs and tax treatment as the sector was generally more labour intensive, using more employees to produce a “fraction” of the beer volume that larger companies do.

Originally published as ‘Greedy’: Aussies fuming over new beer slug