Australia: Big rise in beer tax will harm sector

A speculated 300 per cent lift in tax on beer would threaten the survival of the micro-brewing industry, according to boutique label Snowy Mountains Brewery, AAP reported May 8.

Some media reports have said the Rudd government's National Preventative Health Taskforce is demanding a 300 per cent increase in beer and wine taxes.

However, a spokesman for Health Minister Nicola Roxon said there had been no decision by the taskforce on such a rise and no formal recommendation had been made to government.

Snowy Mountains Brewery director Kevin O'Neill said small brewers were already struggling with higher prices for barley malt and hops and a big lift in beer tax would place some in jeopardy.

"Such an action threatens the future of the local micro-brewing industry," Mr O'Neill said.

"This tax comes on top of 50 per cent excise already paid per carton and makes it almost impossible to survive for most in the micro industry.

"The bigger breweries may be able to sustain these costs but most small operators will struggle."

Mr O'Neill said a lift in beer tax was unlikely to stem binge drinking and was just a revenue-raising exercise.

"People will still continue to buy alcohol. They will just cease to go to the pub, or they will buy cheap alternatives with nastier ingredients, or make their own, which means the alcohol can't be regulated," he said.

The higher tax would also discourage investors from being involved with micro-brewers because the margins would not make an appealing investment.

08 May, 2008