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Ministers Kick Off Geelong Road Project
April 26, 2000
Consumer Price Index, beer, reconciliation
April 28, 2000
Ministers Kick Off Geelong Road Project
April 26, 2000
Consumer Price Index, beer, reconciliation
April 28, 2000

Excise on Beer

NO.032

Excise on Beer

The Government has kept its commitment on beer as was stated in the Government’s

policy, A New Tax System.

Page 87 of that policy stated:

“…the change in excise will be limited so that the retail price of a carton

of full strength beer need only increase by the estimated general price increase

associated with indirect tax reform.” (ie 1.9%).

It is not possible to have a standard excise regime which produces a 1.9% price rise in

a carton of beer and the same on a draught beer across the bar.

Senator Lees notes that the Government has kept to its promise on wine which was that:

“The Wine Equalisation Tax will be levied at such a rate that the price of a four

litre cask of wine need only increase by the estimated general price increase associated

with indirect tax reform; ie 1.9%.” (ANTS, p87)

Again this is the effect on the low value product even though it moves the cost of a

bottle of premium wine by more than 1.9%.

The Democrats fully support the application of the GST to services. There is no

consistency in applying the GST to the service of food in a restaurant, which the

Democrats support, but not applying it to the service of alcohol in the same restaurant,

or in a pub or club. Since a draught beer has a service component, a standard excise and

GST means that its price moves more than a packaged product.

Whilst today’s press release might be seen as good populist politics, it is not

properly thought through and is unachievable under a standard excise and GST regime.

If the Democrats were really interested in holding the Government to its election

commitments they would have passed the Government’s tax policy in full, a long time

ago.

27 April 2000

Media Contact: Niki Savva 02 6277 7340