A recent decision by the Australian government to freeze the excise tax on draught beer has sparked controversy, with critics describing the move as “discriminatory in every sense” for benefiting brewers over distillers. The temporary duty freeze, announced by Prime Minister Anthony Albanese on March 1, will halt tax increases on beer starting August 2025 for a two-year period. The freeze comes as part of a broader effort to address inflation and support the hospitality industry.
However, the move has faced backlash from Spirits & Cocktails Australia, which represents the country’s distillers, who argue that the freeze unfairly excludes spirits. Australia has 700 distilleries, including prominent names like Four Pillars, and the spirits sector is notably impacted by some of the highest alcohol taxes globally, with rates three times higher than those imposed on beer.
Greg Holland, Chief Executive of Spirits & Cocktails Australia, condemned the tax freeze, stating that there was no justification for singling out beer for the freeze. “This policy favours beer drinkers over spirit drinkers, brewers over distillers, and pubs over bars,” he said. Holland further emphasized that the tax on spirits is already significantly higher than beer, which he described as an inequitable treatment of the two sectors.
The criticism also comes amid a recommendation by last month’s Inquiry Into Food and Beverage Manufacturing in Australia, which suggested the creation of a trade body for the spirits industry to mirror the support the wine sector enjoys. Despite this recommendation, the government has yet to act on alcohol tax reforms that could benefit the country’s distilleries, including those based in regional areas, which make up half of Australia’s distillery sector.
Paul McLeay, CEO of the Australian Distillers Association, also voiced concerns over what he called the government’s “favouritism” towards the beer industry. The freeze on beer duties, McLeay argued, undermines the government’s upcoming AU$50,000 (US$31,658) tax relief for distillers, set to take effect in July 2026. He added that the spirits industry has long advocated for growth opportunities, including the potential for Australian spirits to become a AU$1 billion export industry by the decade’s end.
The duty freeze comes ahead of Australia’s general election in May, with Albanese expected to seek re-election after his victory in 2022. Critics are now calling for more balanced policy measures to support both the beer and spirits sectors moving forward.
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