Pubs fight to end the hidden tax on beer

The Australian Hotels Association has launched a national campaign to cut the tax on draught beer for pubs and their patrons.

Excise duty rates for alcohol are raised twice a year, in line with the consumer price index (CPI). The latest tax hike was passed last Tuesday and will add roughly 60 cents to the cost of a schooner and 80 cents to a pint of draught beer.

Australian Hotels Association CEO Stephen Ferguson is lobbying politicians to slash the beer tax in half.

He told the Hobart Mercury: “The government always tells us they want to decrease the cost of living, lower taxes, and enable Australians to keep more money in their pockets, but when it comes to draft beer Australia has the fourth-highest beer tax in the world.

“When they make this increase each six months it takes about another $160 million from Australians’ pockets.

“This is about jobs and sociability. It is a lot cheaper to buy a slab of beer and go home rather than go to the pub. The hidden beer tax goes up twice a year and it went up quietly again last Tuesday and it is making it unaffordable for many older people to go to the pub.

“The government wants to lower taxes and let people keep the money they earn – well halving this tax will do that.”

Chief Executive of the Brewers Association of Australia John Preston agrees that the Federal Government needs to “give pubs and clubs a fighting chance”.

“The industry is telling us they want to help out their patrons as well as employ more as they rebuild. But the high level of tax is holding them back,” he said.

How COVID has decimated pub beer sales

Australian Tax Office figures show that pubs and clubs sold 40 million fewer pints of beer between July and September last year than they did during the same period in 2019 and before COVID-19.

That’s a massive drop of more than 50% in beer sales for struggling venues.

In 2020, pubs and clubs lost over $1 billion in beer sales due to lockdowns and other restrictions, but these latest figures from the ATO show that losses for 2021 could well exceed that.

The ATO recorded 903,982 litres of alcohol as having been served in beers over the counter in July-September 2021 compared to 1,993,027 litres during the same period in 2019.

Pubs have also been hit with staff shortages and supply chain issues in recent months.

Drinks industry calls for tax freeze

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