Drinkers set for more cost-of-living pain as the federal government urged to review ‘inefficient tax’

Drinkers will soon be forking out more than $15 for a pint of beer, while a cocktail will jump to $24 in the latest government tax grab.

Beer and spirit lovers are set to be slugged more than $15 for a pint and $24 for a negroni when the tax on alcohol is hiked again next month, in another cost-of-living blow.

The federal government is facing renewed pressure to freeze the excise, with industry calling for urgent reforms to ensure local manufacturing remains viable.

Victorian distillers are warning the biannual rise, expected to be between 2-3 per cent, is forcing them to consider moving their business overseas as the spirits excise soars above the current $100 a litre.

The February 1 indexation will also result in the beer tax rising to more than $60 per litre of pure alcohol.

A pint of beer is set to cost more than $15 at many venues because of the tax hike.

Spirits & Cocktails Australia chief executive Greg Holland said the tax was fuelling inflation and making spirits unaffordable for consumers.

Mr Holland said government revenue from the tax was forecast to fall this year, with the price of cocktails such as a negroni set to rise $2 to $24 compared to last year.

“Continued increases would be nonsensical,” he said.

“Consumers, manufacturers and the government all lose out to this inefficient tax.”

Brewers Association of Australia chief executive John Preston said the latest increase was also bad news for brewers and beer drinkers.

“In many venues, people are paying over $15 for a pint. This is a huge amount considering how tight the family budget is,” Mr Preston said.

The cost of a negroni is set to be more than $24. Picture: Jonathan Ng

The increase will take the excise on a pint to about 90 cents, and the tax on a $55 carton of beer to more than $20 plus GST.

In August, the tax on a keg of beer increased about $2 to $78.

Australian Hotels Association chief executive Stephen Ferguson said: “When increases to the cost of living are impacting so many Australians, the government should consider freezing excise for the next couple of years.”

Australia’s spirits tax is the third highest in the world, behind Iceland and Norway.

David Vitale, founder Port Melbourne’s Starward Whisky, said Australia’s regulatory environment drove it to establish its brand in the US, where spirits excise was $10 a litre.

The tax on a keg of beer increased to $78 in August. Picture: Rebecca Bennett

“We’ve invested a lot in the local economy here in Melbourne with our visitor experience and workforce, but our sights have to be set on export markets because it’s simply uncompetitive to operate here in Australia,” Mr Vitale said.

Top Shelf International chief executive Trent Fraser said it was looking to expand its operations into the US, saying Australia was the “worst market” he’d operated in after two decades abroad.

Bundaberg Distilling Co chairwoman Amanda Lampe said it was “outrageous” that 63 per cent of the cost of a one-litre bottle was tax as it tried to keep production costs down.

“We know this isn’t a problem that the current federal government created, but today we’re asking them to help fix it by freezing the excise on spirits,” she said.