Northern Beaches brewers are set to win significant tax cuts from the federal budget.
The craft alcohol industry has taken off on the Northern Beaches in recent years with around a dozen artisanal brewers and distillers having opened over the last decade. They have grabbed the attention of industry heavyweights in the process with the world’s largest beer company Anheuser-Busch InBev acquiring Manly brewer 4 Pines in 2017.
Small brewers and distillers are set to be beneficiaries of a tax cut worth $250k each per year proposed in the federal budget. The changes, which come into effect from 01 July, will more than triple the volume of liquor that producers can sell before they need to pay excise tax.
Brewers and distillers currently get a rebate from the government of 60 percent of the money due in excise when products leave the warehouse, up to an annual cap of $100k. Under the plan to be unveiled on budget day this month, the government will completely remit the duty payable by brewers and distillers on the first $350k.
The changes amount to a tax cut for the industry worth $255m a year nationally, of which local brewers are set to reap around $25m.
Federal Treasurer Josh Frydenberg said the measure would give small businesses a meaningful amount to invest in their business.
“This change will allow these small businesses right around Australia to go and hire more people, to go and invest in their business to grow, to get the new equipment and machinery that they need,” said Treasurer Frydenberg.
Chairman of the Independent Brewers Association Peter Philip welcomed the announcement saying that excise tax was the biggest cost per litre of beer.
“Excise tax is the single largest component of the cost of making a litre of beer, and it’s one of the highest beer taxes in the world. With this change, small brewers will be able to invest more in people, equipment, and facilities to meet growing demand,” said Mr Philip.
Member for Mackellar Jason Falinski said the tax cut was budget news Northern Beaches brewers would love.
“This is a meaningful boost for a group of growing businesses on the Northern Beaches. Our small brewers and distillers need to be globally competitive and this will help them grow their business, jobs, the local economy and exports. Whether you like a DDH Stunner from Modus Operandi or a lightly hopped lager from Trust Tree, this one is for you,” said Mr Falinski.
Images: Envato, Northern Beaches Advocate