Spirits industry calls for Albo’s beer tax freeze to extend to mixers, RTDs, cocktails

The spirits industry is calling on the government to extend its beer tax freeze, saying relief “shouldn’t be dictated by whether you have a draught beer or a margarita”.

Young people, women and small businesses will be slugged more for booze with the price of spirits set to rise again while the cost of draught beer is frozen, after Anthony Albanese only promised to freeze the tax on beer for the next two years.

Patrons ordering cocktails, mixers and ready-to-drink (RTD) beverages at pubs and clubs across the country will pay more from August 4 when the tax on alcohol is increased for the second time this year in line with inflation.

But beer drinkers won’t be hit with the same hike after the Prime Minister committed to freezing the excise on pints, schooners and pots on Thursday after promising to halt prices before the election in a bid to win over voters.

The spirits industry is now calling for the government to extend its tax freeze to spirits served in venues, such as gin and tonics and Hard Solos, so businesses and customers don’t miss out on the cost-of-living relief.

Old Mates Place co-owner Dre Walters said patrons at his award-winning cocktail bar in the Sydney CBD shouldn’t have to pay more for their drink if they don’t want beer, with woman and younger people more likely to be stung.

Flick Eshman and Old Mates Bar owner Dre Walters. Old Mates Bar, a small independent venue specialising in cocktails and mixed drinks, will among the hardest hit by the tax increase on spirits. Picture: Justin Lloyd.

“Excise relief on tap beer is great, it’s a step in the right direction, but we can do more – we can make it fair for everyone,” Mr Walters said.

The hospitality stalwart said the twice-a-year excise hit has also put a “huge burden” on smaller venues and mum-and-dad businesses who are trying to keep prices down for their patrons despite mounting costs.

Old Mates Bar owner Dre Walters says in the next five years we could be looking at paying $35 for a cocktail. Picture: Justin Lloyd.

“To operate any hospitality business in Australia is hard, having anything increase twice-a-year is a huge burden … in the next 10 years that’s 20 increases on spirits alone,” Mr Walters said.

“In the next five years based on a little bit of forecasting its going to be $35 for a cocktail … and it’s not us charging that to make heaps of money, it’s so we can pay our staff and pay out rent.”

Under the decades-old scheme, the tax on alcohol is adjusted twice a year in February and August in line with the Consumer Price Index (CPI).

For the first time this August, draught beer will be exempt from the increase and prices will be frozen for the next two years.

The tax on spirits, however, were already hiked by an extra 0.42c this year to $104.31 per litre of alcohol, meaning Australians pay one of the highest tax rates in the world for their spirits.

Although the exact increase will not be determined until the latest CPI is published in the next week, Australian Distillers Association general manager Cameron Mackenzie said businesses could not cope with the current scheme.

“This tax hurts our customers and more than 700 distillers across the country who want to share more of our products at Aussie pubs and clubs. We want a system that doesn’t favour one drink over another,” Mr Mackenzie said.

While Night Time Industries Association chief executive officer Mick Gibb called for the government to match its tax freeze for spirits, saying relief “shouldn’t be dictated by whether you have a draught beer or a margarita”.

Assistant Treasurer Daniel Mulino was contacted for comment but did not respond before deadline.

Originally published as Spirits industry calls for Albo’s beer tax freeze to extend to mixers, RTDs, cocktails