Dylan Firth: Brewers' Association Executive Director on the increase to the alcohol excise tax

Beer brewers say they're disappointed in the government for bumping alcohol taxes. 

The alcohol excise tax is set to increase by 4.1% from July. 

It follows a number of increases over recent years. 

Brewers' Association Executive Director Dylan Firth told Mike Hosking that things are pretty tough out there.

He says the last government made a number of increases to the tax, but more hikes are unsustainable. 

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Episode Transcript

Speaker 1 (00:00):
A bit of concern in the brewing industry between those

(00:02):
going under and the cost of the exercise tax. Government
confirmed yesterday tax is coming four point one percent as
of the first of July. Executive director of the Brewers Association,
Dylan Firth is with us. Dylan, very good morning to you.

Speaker 2 (00:14):
Good morning Mike.

Speaker 1 (00:15):
How would give us a word for your industry at
the moment? Miserable, upbeat, suicidal, brilliant? What's your word?

Speaker 2 (00:23):
Our getting through? I think is probably the word we
want to use. It's pretty tough out there, like mini sectors,
and you know, the brewing sector for a number of
years has been relatively flat. There's not a lot of growth.
There's some bright spots, but I think you know, in
this economic climate, discretionary spend is down and we see
it through the hospitality sector. It thinks are pretty tough
out there.

Speaker 1 (00:41):
What's the tax designed to do? Stop us drinking or
just collect money?

Speaker 2 (00:46):
Well, it does a bit of both. I mean a
subscribed as doing that, but it does get taken into
the consolidated funds. I mean there's about one point three
billion dollars it's taken last year and it's not ring
fence for anything. In particular. So we've seen an increase
over the last three years of a combined close to
eighteen percent, and it's linked to inflation each year, so
you know over the previous government in this one and
they've decided to continue it at this rate. But unfortunately

(01:08):
it's not really a sustainable system when it's got levels
of inflation, and we've seen that because people aren't spending
money and there isn't growth to be able to sustain.

Speaker 1 (01:16):
So here's your problem. You want them to pause like
they do in Britain at each budget they seem to
go all to be no increase in the excience this year,
but you want it to pause until you would argue
inflations back under control the economies, right, But then what
will happens. You'll come back on the program going na, na, no,
we need another year's pause, won't you? You want it forever.

Speaker 2 (01:32):
I've looked pausing just one of the things that have
gone on around the world, and we've advocated for a
number of things. You look at Canada, for example, who
saw high levels of inflation and they have a similar
system and they capped at two percent this year. You know,
we think that that's a good option. We've also said
there's an opportunity to put a separate key rate in
for supporting hospitality businesses, so a lower rate specifically for

(01:53):
tat beer. So the number of things out there you
could do and look at the end of the day,
if it's linked to a sustainable increase over the years
of around one three percent, like we say to the
reserve banks to keep inflation there, I think that's something
that industry could handle.

Speaker 1 (02:05):
Not a bad argument, Dylan, appreciate your time very much,
Dylan Firth, Executive director of the Brewers Association.

Speaker 2 (02:10):
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