Dylan Firth: Brewers Association Executive Director on the call to halt increases on the draught beer excise tax

An argument for dropping beer excise tax here so businesses stay afloat.  

Australia's Government is stopping further tax increases landing on beer poured in venues from kegs. 

Meanwhile, excise tax continues to rise automatically in New Zealand every year. 

Brewers Association executive director Dylan Firth told Mike Hosking fewer people are going to the pub because the tax is driving up the cost of a pint. 

He says if hospitality businesses have their own keg rate, venues wouldn't have to push their margins as much to stay open, and people won't lose those socialised spaces. 

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Episode Transcript

Speaker 1 (00:00):
So let's talk be another call for a freeze on
excise tax. Australia is just frozen. There's on the draft beer.
So the pub business is doing it hard over there.
At the moment, excise is up more than twenty percent
and five years consumptions fallen, which is part of the problem.
The government pulls in about four hundred and seventy million
dollars from brewers each year. Dylan Firth is the Bruce
Association executive director and as well as Dylan, very good
morning to you.

Speaker 2 (00:20):
Good morning Mike.

Speaker 1 (00:22):
It's an interesting conundrum, isn't it what you're asking for
essentially as a handout.

Speaker 2 (00:27):
Well, I mean, if you look at Australia, they've frozen it,
but I think they're already one step ahead in the
fact that they have a separate rate for kegs. So
that's draft beer, a beer that are poured out of taps.
And so what we're saying is that in New Zealand
that's something where we should go into first, so we
can get some sort of parody there because at that
lower rate it would be much better for businesses versus
just a freeze.

Speaker 1 (00:46):
Yeah, but of course if you had no tax on
beer whatsoever, it'll be even better, wouldn't it. I mean,
that's that's what we're arguing about.

Speaker 2 (00:53):
Look, no tax on anything would be great, but unfortunately,
you know, tax is one of the things that we
have to have. But one of the things about the
excise tax is that it's increased a year with CPI.
So while a lot of other taxes don't go up,
XOS tax does. And what it's done is that it's
linked with CPI. So in the times when it is
tough and CPI is higher and people have less discretionary spend,
we're seeing businesses hit with higher tax rates. What we're
saying is that, well, actually, this system overall doesn't really work.

(01:16):
We've taken you know, one point two five billion dollars
in tax for the last five years straight now, when
it's been going up by twenty percent over that time. Overall,
that's going to be unsustainable.

Speaker 1 (01:25):
Yes, it is. What the reason I'm asking the questions
the way I'm asking is, I wonder if your problem
is not actually money, it's just people are off beer
because it's not as good for and people are working
that there's a global move against alcohol, and that's your issue,
not really what it costs. Is that fair or not.

Speaker 2 (01:43):
I think there's a combination of a number of things,
and one of them is around people choosing to moderate more,
people are drinking less overall. We're seeing higher levels of
zero percent beer consumption. You know, we're seeing less levels
of harmful drinking as well as lower levels of drinking overall.
Although those are slightly different. What we do see those
is that people are still enjoying a bear and one
of the things that's happening is that they are not

(02:05):
going out as much, so they'll be choosing to drink
at home. So we used to see a kind of
forty sixty percent split of bars versus hospitality. Now it's
about fifteen percent of beer sold an on premise, and
part of that is price, and a lot of that's
driven by the cost of the product, and a lot
of the cost of the product in this case is tax.
So what we're saying is that if you split it
a little bit more better, or hospitality venues to have
their own care grape similar to what was in Australia,

(02:27):
then would see that hospitality venues probably wouldn't have to
push as much to get their margins. They need to
stay open so we don't lose these venues and ultimately
people don't lose those socialized spaces.

Speaker 1 (02:36):
Well, argued Dylan Firth, who is the Bruce Association executive director.
And my suggestion is in a country where we pay
nine to ten billion dollars a year on the interest
on our debt, reducing your revenue from the government's point
of view is a no go.

Speaker 2 (02:49):
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