The Craft Beer Industry Association (CBIA) is calling on all candidates in the upcoming federal election to commit to giving craft beer producers the same excise relief enjoyed by other sections of the drinks industry.
The 2016 federal budget delivered the news of a proposed amendment to the wine equalisation tax (WET) rebate, aimed at “returning the rebate to its original policy intent of supporting small wine producers in rural and regional Australia”. This is to be achieved via a proposed reduction, over a two-year period, from the current level of $500,000 to its 2004 level of $290,000.
CBIA Executive Officer Chris McNamara says the effect is that, even after the rebate reduction, wineries effectively pay zero excise on their first $1 million of sales every year.
“Small beer producers are not extended similar excise-relieving treatment,” he said.
“The total increased cost of lifting the rebate cap to match that of wineries would be in the order of $15 million. This would benefit more than 150 of Australia’s craft breweries, who would be able to reinvest these funds back into their businesses through equipment purchases, innovation and market development with the resultant creation of jobs.
“The budget papers highlighted that the proposed change to the WET rebate will save $300 million over four years. It’s about time that a small fraction of those savings were used to afford small brewers the same opportunity for excise relief – and the consequent ability to invest in growth and in their regional areas – as our winery counterparts.”