Distillers in Australia are urging the federal government to halt increases in spirit excise for two years, stating that the tax burden is becoming unbearable for small and emerging distilleries. The excise on spirits has surged by 15% over the past three years, with more than half the cost of an average bottle of spirits being attributed to tax.

The chair of Bundaberg Distilling Co, Amanda Lampe, expressed outrage at the current tax rates, emphasizing the challenges it poses for businesses in managing production costs. The company is advocating for an immediate freeze on excise increases to facilitate discussions on potential solutions to the issue.

While the excise generates $5 billion for the government annually, the Australian Distillers Association and industry representatives argue that the rapid tax escalation is detrimental to the growth of regional economies and the local industry.

On the other hand, the Alcohol and Drug Foundation has cautioned against any adjustments to the excise regime, expressing concerns that such changes could elevate the risk of alcohol-related harm. The foundation’s stance reflects the complex considerations surrounding the issue, as the economic impact of excise adjustments must be balanced with public health and safety concerns.

The ongoing debate underscores the need for a nuanced approach to tax policy, one that addresses the challenges faced by businesses while also safeguarding public welfare. As the distillers’ plea for a moratorium on excise increases gains momentum, the government faces the task of balancing fiscal interests with the well-being of the community and the industry.