Australia has raised its alcohol excise taxes by 4% bringing the price of a pint of beer to $15. Currently, Australia increases excise taxes on beer twice a year according to inflation, as recommended by the World Health Organization (WHO). Big Beer has for years been lobbying aggressively to secure tax cuts. The most recent attempt was a few months ago, prior to the Australian Budget. But inspired advocacy by communities halted this ill-advised proposal.

The Australian tax office raised alcohol excise taxes by 4% in August bringing the price of a pint of beer in Australia to $15. The alcohol tax increase is a win for people and communities, as the policy improvement will reduce the harm caused by cheap alcohol.

Australia raises its excise tax on beer twice a year, to adjust it to inflation. Higher inflation means higher taxes. Therefore, the latest tax increase has been the highest in 30 years. But even though wine is also alcohol, the wine tax is still operated under a different system.

According to the tax hike for full-strength beer served from a keg in a pub, the excise will increase by $1.51 to $39.27 for every liter of pure alcohol. For packaged beer, the excise will increase by $2.14 to $55.73 per liter of alcohol.

Raising excise taxes on alcohol is the most impactful and cost-effective policy solutions to prevent and reduce alcohol harm. It is recommended by the World Health Organization. Adjusting excise taxes to inflation is a proven and evidence-based part of reducing alcohol affordability and protecting people from harm.

Big Alcohol lobbies for tax reduction

As Movendi International previously reported, Big Alcohol fronted by The Australian Hotels Association (AHA), Clubs Australia (CA), and the Brewers Association (BA), pushed aggressively for a 50% reduction in draught beer taxes in the 2022 Budget.

Fortunately, advocacy by Australian communities against this ill-advised measure prevailed and the tax cut did not go through.

Alcohol industry profits while alcohol harm rises

Now as the new excise tax increase reduces the affordability of beer, Big Alcohol front groups are yet again complaining, using the same arguments to lobby against public health policy solutions.

However, contrary to alcohol industry claims, in 2020, amidst the ongoing pandemic, alcohol companies made $15.6 billion in retail sales, which is a 26.7% increase from 2019. 

While the alcohol industry maximized profits even during the COVID-19 pandemic, alcohol harm increased rapidly in Australia.

Rising death toll due to alcohol
Compared to 2019, Australia faced an 8% increase in deaths due to the products and practices of the alcohol industry in 2020.

Tax cuts would only benefit Big Beer

Only multinational corporations stand to benefit from beer tax cuts. The alcohol industry front group Brewers Association (BA) has been lobbying for tax cuts already before the pandemic. In their most recent attempt to reduce taxes they joined forces with the Australian Hotels Association (AHA) and Clubs Australia. Behind these groups are some of the world’s biggest alcohol and sugary beverage companies pushing for beer tax cuts in Australia:

  1. Kirin, a Japanese beer giant owning Lion Brewery,
  2. Asahi Breweries, a Japanese alcohol conglomerate, owning Carlton & United Breweries,
    1. Both Lion and C&B Breweries are members of the BA.
  3. Diageo, a British liquor giant, and
  4. Coca-Cola Amatill,
    1. Both are members of AHA, where also Asahi is a member.

The proposed beer tax cut by Big Beer would have cost the Australian government $150 million per year. Over three years, this could amount to almost half a billion dollars lost. Meanwhile, Big Beer giants Lion and Asahi, which control almost three-quarters of the beer market in Australia, would have benefitted the most with windfall profits

The Big Alcohol lobby pushes for tax cuts to maximize the profits of multinational alcohol companies, even at the cost of the health and well-being of people and communities in Australia.

Source Website: The Guardian