Labor looks to loosen voters with $200 million beer boost

Anthony Albanese is letting the beer flow in a $200 million bid to woo pub-goers, brewers and venue owners leading into a federal election where polls show it is on track to lose its majority in parliament.

A two-year freeze on the indexation of draught beer excise – which covers beers on taps rather than those bought at bottle shops and is to be announced on Saturday – is Labor’s latest attempt to loosen up voters and the brewing industry before it heads to the polls.

Excise is charged depending on the alcohol content of beer. A pint of full-strength draught beer – 5 per cent – would attract excise of about $1. The two-year freeze would likely save drinkers 10¢ a beer.

The industry has faced a plunge in demand for beer, partly as a result of steadily rising excise, which increases twice a year in line with inflation.

Albanese’s freeze on excise rises will come into effect from the next indexation date, in August, and cost the budget up to $200 million over two years.

This financial year, the government expects to collect $7.8 billion in excise from alcoholic beverage sales, of which $2.7 billion is expected to come from beer.

The latest alcohol excise increase, of 2 to 3 per cent, took effect on February 3 despite opposition by the Brewers Association of Australia. After the increase, draught beer attracts an excise rate of $10.57 to $43.39 a litre of alcohol.

The industry body had urged Albanese to follow the lead of Britain’s Labour government, which used its first budget to extend reductions in beer tax that had begun under the previous Conservative government.

“On behalf of brewers and beer drinkers across Australia, we are asking for urgent action to address the high rates of beer tax,” Brewers Association of Australia boss John Preston said in January. “All these tax hikes are doing is making it increasingly unaffordable for Australians to head out to their local for a beer.”