Mr ENTSCH: I’m here to speak in strong support of the motion moved by the member for Cowper, which highlights the critical issue of alcohol excise in our country. This is not just about beer and spirits; it’s about the survival of small businesses, the livelihood of thousands of Australians and the future of an industry that is prevalent in all of our communities.
We are all aware that the cost of living in Australia has been rising at an alarming rate. Electricity bills, raw material costs, transportation expenses, the list goes on—everything has been going through the roof. But what makes the situation even more untenable for our local brewers and distillers is the relentless biannual increase in alcohol excise. As it stands, Australia is ranked among the highest in the world when it comes to alcohol excise, and this is crippling our domestic industries.
I recently received a letter from Rob Callin, the owner of Macalister Brewing Company, a proud and hardworking small business in my electorate of Leichhardt. Rob’s story, unfortunately, is not unique. Like many other small independent brewers, Rob has faced a staggering 40 per cent increase in production costs over the past two years. I think this is the difference we are talking about now: the significant increase that we’re seeing in cost of living. It’s unprecedented, and it’s certainly having a significant impact in this industry. The increase in production costs, coupled with automatic six-monthly increases in excise tax, is pushing these businesses to the brink. Rob tells me that, in the past 12 months, over 20 independent brewers across the country have either gone into voluntary administration or closed their doors for good. The majority of the more than 600 small brewers that are still operating in Australia have been forced to reduce staff just to keep the lights on.
Small breweries like Macalister Brewing Company, Copperlode Brewing Co. and Hemingway’s Brewery are an integral part of our local communities. They employ local people, support regional tourism and contribute to the vibrant culture of Far North Queensland. These businesses are also essential to our regional and rural economies. The craft beer industry in Australia provides approximately 35,000 jobs, two-thirds of which are located in regional and rural areas. It’s important to remember that these small businesses are not just competing against each other; they’re competing against the giant multinational corporations with far more resources available to them. While the excise remission scheme for small businesses is indeed a lifeline, the problem is that the remission is capped at $350,000, and it’s not indexed to inflation. This means that, as the excise goes up every year, the value of this remission effectively erodes, putting even more pressure on small businesses.
It’s clear that the current excise regime is unsustainable, out of date and no longer fit for purpose. The government needs to take immediate action to provide relief to our domestic beer and spirits industry. The industry is desperate for a sensible package of tax reform and policy settings that balance the responsible consumption of alcohol with the need to support industry sustainability and growth. It’s no secret that Australians like a drink, but the ever-increasing cost of shouting a round for your mates at the pub is becoming prohibitive. The government is going to send punters, publicans and brewers all bankrupt. It’s unsustainable and, quite frankly, it’s un-Australian.
Our trading partners, including Japan, the United Kingdom and Canada, have already moved to freeze alcohol excise duties to relieve pressure on their domestic industries. I believe that Australia must follow suit. The fact that we might have done it in the past doesn’t mean that, with the changing circumstances, we should continue to do it to the point where we wipe out an industry in total. We can’t afford to wait any longer. The government must now act to freeze and reduce the alcohol excise, provide targeted relief for small brewers and distillers and ensure the long-term viability of this important industry.
Lastly, I commend the member for Cowper for bringing this motion forward and I hope that the parliament will listen to these concerns of industry and decisively address what is a very critical issue.