The Australian Government released its Federal Budget 2025-26 on 25 March, describing it as a “responsible Budget that helps with the cost of living, while Building Australia’s Future”.
“We are delivering more tax relief for every Australian taxpayer, more energy bill relief and cheaper medicines,” Prime Minister Anthony Albanese said.
“We are strengthening Medicare, investing in housing and education, advancing reforms to make our economy stronger, and building a Future Made in Australia.
“The Budget builds on the strong foundations we have laid, helping to secure our nation’s future at a time of global uncertainty.”
Brewers, for example, will be given a two-year freeze of the alcohol excise for draught beer. The Prime Minister said the move would take pressure off the price of a beer poured in pubs, clubs and other venues, supporting businesses, regional tourism and customers across Australia.
“My Government is building Australia’s future and to do that we need to support our small and medium local businesses to thrive,” Albanese said.
“Freezing the excise on draught beer is a common sense measure that is good for beer drinkers, good for brewers and good for pubs.”
The support comes too late for the dozens of craft brewers that have collapsed over the past two years, with most blaming the excise charges at the ATO for their insolvencies.
Australian Hotels Association national chief executive Stephen Ferguson said: “We’re concerned about a drop in the number of people being able to go to the pub and enjoy a beer, have a meal and be entertained. This is a great first step in just giving everyone a break.”
Ferguson told the ABC the tax freeze would help hotels maintain staff during a cost of living crisis that has meant more Australians are staying home to save money.
“This freeze will be quite minor in terms of cost, but also what the government said is they are willing to consult over the next period on how the excise works,” he said.
However, the wine and spirits industry say the Federal Budget doesn’t offer enough support to struggling winemakers and distillers.
Sour grapes and half measures
Australian Grape & Wine expressed “deep disappointment” at the Australian Government’s “failure to deliver meaningful support to the grape and wine sector in the 2025-26 Federal Budget”, describing it as a second major missed opportunity in as many years.
“This Budget is another blow for growers and winemakers across Australia,” said Chief Executive Lee McLean.
“It fails to deliver the targeted programs or strategic investment needed to address the serious challenges facing one of Australia’s most iconic and economically important regional industries.”
Australian Grape & Wine acknowledged the Government’s pre-budget announcement to increase the Wine Equalisation Tax (WET) producer rebate cap to $400,000 from 1 July 2026, describing it as a welcome measure for some small and medium-sized producers.
“We welcome the increase to the WET rebate cap — it will assist some producers with much-needed tax relief in the years ahead,” said McLean. “But tax relief alone doesn’t address the structural crisis gripping our industry, largely driven by the lingering impacts of trade impediments our producers did not initiate, or deserve.”
The Budget includes $6.8 million for international agricultural engagement and market access, which may benefit some wine exporters. However, Australian Grape & Wine warned that this falls well short of the coordinated, sector-specific investment required to diversify markets and rebuild export momentum.
“This isn’t the bold action our sector has been calling for — it’s a modest allocation spread across all of agriculture,” Mr McLean said. “We asked for targeted investment in sustainability programs, export assistance, and domestic tourism development. None of that has materialised.”
“The re-opening of the China market is a welcome development, but it’s not a silver bullet. The oversupply of red wine alone sits at more than 330 million litres. Businesses are selling water rights to put food on the table or pay power bills. They’re laying off staff, and many growers haven’t drawn a wage in years. The impact on regional economies is profound — and the need for support has never been more urgent.”
Australian Grape & Wine said it remains committed to fighting for growers, winemakers, and the future of wine communities across the country.
“We’re not giving up,” said McLean. “Our industry contributes $45.5 billion to the economy yet has once again been left to wither on the vine. It’s time for the Government to step up and show it values the people, regions, and industry that have contributed so much to this country. Before it’s too late.”
Budget lacks structural reforms for spirits
Spirits & Cocktails Australia chief executive Greg Holland said the 2025–26 Federal Budget bolstered the case for government intervention to unlock the $1 billion export opportunity that has been identified for Australian spirits.
“While we welcomed the Government’s positivity about the domestic economy, we cannot overlook its prognosis of a volatile and unpredictable global economy that guarantees ongoing trade disruption,” he said.
“Against this landscape, growing Australian spirits exports can help the Treasurer achieve his stated ambition of ‘a more productive, dynamic and resilient economy’.”
Holland said the Federal Budget lacked the structural reforms needed to enable the spirits industry to build on its current $15.5 billion economic contribution.
“The Budget has done nothing to rectify the handbrake on our industry in the form of the world’s third highest spirits tax,” he said.
“In fact, the Albanese Government has only exacerbated the structural inequity in Australia’s alcohol tax regime with the draught beer freeze that has been confirmed in the Budget papers.”
Australian Distillers Association chief executive Paul McLeay welcomed the $50,000 increase to the alcohol manufacturers remission threshold, that will provide much needed headroom for Australian distillers to reinvest back into their businesses.
“The uplift in the Alcohol Manufacturers Remission will go most of the way to restoring the value of the scheme in real terms, following rampant inflation since its inception,” he said.
“However, more needs to be done to provide the foundations to support sustainable long-term growth and unleash the industry’s $1 billion export potential.
“This must start with adopting the Spirits Export Accelerator Strategy (SEAS) proposed in the industry’s Pre-Budget Submission,” he said.
“While we admire the Government’s long-term commitments to net zero manufacturing opportunities, we know there is immediate demand in export markets for high quality, differentiated Australian spirits products that value-add to Australian agriculture.”
“SEAS aligns with the Future Made in Australia agenda, boosting domestic manufacturing, while also delivering jobs and growth for regional communities, which is where 50% of Australia’s 700 distilleries are based,” said McLeay.
“As the Government seeks to weather a storm of trade tensions and tariffs, local distillers say it’s time to let SEAS set sail so we can stock the shelves of the world with award-winning Australian spirits.”