Coalition split as on-tap spirits seek inclusion in draught beer tax freeze amid alcohol industry pressure

Another policy split is emerging in the Coalition – with the Nationals supporting a proposal to freeze modest tax increases for spirits served on tap, but the Liberals showing no enthusiasm for extending the temporary relief beyond draught beer.

With Parliament this week continuing to debate the Albanese Government’s two-year pause on draught beer excise increases, the lobby group representing the spirits industry is pushing for the measure to cover other popular drinks served on tap.

Ahead of the festive season, Spirits & Cocktails Australia argues that the “sensible cost-of-living relief” should apply to all hospitality venue patrons, not just those who choose to drink beer, which industry representatives say are mostly older men.

The proposal would include bulk containers of spirits and premixed drinks designed to be connected to pressurised or pump delivery systems but would not extend to standard bottles of full-strength spirits or to individual ready-to-drink bottles or cans.

At present the excise on spirits is 2.5 times higher than the rate applied to beer, with the industry claiming the most recent hike pushed the tax for a standard 700ml bottle of gin or whisky to $30.

According to industry estimates, using ATO reporting and international data, extending the excise freeze to such products would cost around $5 million per year, on top of $95 million the government expects the existing draught beer relief to total over five years.

“The spirits industry supports this cost-of-living response,” Spirits & Cocktails Australia Executive Director Steven Fanner says.

“Every MP who has spoken on these Bills in Parliament so far has noted the positive impact a freeze will have on jobs and the hospitality industry. The spirits industry couldn’t agree more”.

“Applying the freeze to all tap alcohol would ensure that every patron buying a drink at the bar will get the same cost-of-living relief and remove the discrimination against the growing number of spirits drinkers who purchase their drinks at the bar.”

Despite the minuscule cost to the budget, the Albanese government has shown no willingness to extend its excise freeze beyond draught beer, but Nationals leader David Littleproud and Teal independents have spoken in favour of the idea.

Last month, Mr Littleproud backed a push by independent MP Monique Ryan for a permanent freeze on beer taxes, but declared the measure should go further by including spirits and alcoholic pre-mixed drinks.

Another teal MP, Zali Steggall is seeking to further expand the government’s measure by moving an amendment to the legislation to “freeze the indexation of alcoholic excise until 2026”.

Already shadow treasurer Ted O’Brien has indicated the Coalition’s support for Labor’s proposal to freeze excise on draught beer but like the government has shown no willingness to apply it to tap spirits served in pubs and bars.

“Many patrons in Australian pubs and clubs are now disadvantaged by an excise freeze that doesn’t apply to the spirits drinks they are ordering on tap at the bar,” Mr Fanner argues.

“With a sensible and modest amendment, the Government can ensure a fairer and more equitable treatment for all Australian drinkers”.

The latest debate on alcohol policy comes as Australia’s political leaders wrap up their final party room meetings with MPs before Parliament rises at the end of the week for the long summer break.

On Tuesday, Anthony Albanese told his caucus colleagues to get out in their communities over the festive season and talk about cost-of-living help, road safety, the social media ban and better funding for schools.

The Prime Minister pointed to the Coalition’s “mistake” in the lead-up to this year’s election by choosing to “stop working in January”, as he thanked colleagues and “the entire labour movement” for helping to win a massive majority in May.

He also thanked his caucus “for giving me this incredible privilege as a Labor prime minister of this country”.

While the PM is urging his MPs to keep busy over summer, down the corridor in the joint party room, deputy Liberal leader Ted O’Brien told Coalition colleagues that it had been a “difficult year” and said they should make sure they had a break.

He also made the point that the Coalition had attracted “a lot of media coverage in the last six months” — with the implication being not much of it good news.