A brewery owner has lashed out at a looming beer excise hike and the soaring costs to maintain a business in Australia.
Sauce Brewing Co founder Mike Clarke told Yahoo the industry was copping it ‘from all sides’ with some businesses unable to stay afloat and forced to close.
‘You’ve got excise going up every six months, as it always does,’ he said.
‘But you’ve also got all of the other costs of doing business that are really increasing faster than inflation is increasing so your cost of goods, wages, land tax, transport, fuel, electricity and gas.’
The beer excise will increase for the second time this year on Monday with Australia having the world’s third highest beer tax.
The beer tax is determined based on the alcohol content and the type of packaging and applies to brewers and distillers.
This year alone, 20 independent Aussie breweries have either closed down, gone into voluntary administration or restructured because of these crushing pressures.
Mr Clarke has already sacrified so much to keep his micro-brewery going and sold his home and put ‘everything on black’ to launch his Sydney business in 2016.
Sauce Brewing Co founder Mike Clarke (pictured) said the industry was copping it ‘from all sides’
Mr Clarke added the industry is also being hit by the cost-of-living crunch, with Aussie beer lovers not spending as much as they used to.
He said his brewery pretty much absorbs the increased costs as it’s not ‘realistic’ to keep hiking up the prices for his customers.
Mr Clarke said he has tried to future-proof their business to deal with the ‘ups and downs’ of the industry by diversifying.
Six months ago, the company launched Twizzle Cocktails, ready-to-serve cocktails in cans.
Dad & Dave’s Brewing operations manager Joel Meaney said they also wear the increased costs instead of raising the prices for their customers who are already doing it tough.
Mike Clarke said the industry is also being hit by the cost-of-living crunch, with Aussie beer lovers not spending as much as they used to (stock image)
He said this latest tax increase is the fifth in two-and-a-half years and tax makes up around a third of the price of every beer they sell.
Mr Meaney said the price of a beer has jumped from $10 to $14 in just two years.
‘We try our very best to stay as loyal to the Australian culture as possible and still make it an achievable thing to do for people to be able to get together and have a glass of beer,’ he said.
Mr Meaney added his brewery tries to offset the increasing costs through setting up a food truck and having trivia nights and live music in their venue space.
The federal government bases any increase to the beer tax on The Consumer Price Index (CPI).
The CPI rose 3.8 per cent annually in the June quarter.
There have been calls on the government to axe the increase to the beer tax.
The Brewers Association has spoken out and the Australian Hotels Association is calling for the spirits tax to be cut.
