Tax relief a win for Mayo's distillers

1 May 2021
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Today’s announcement of tax relief for small distillers is just the economic boost this burgeoning industry needs, according to the Federal Member for Mayo Rebekha Sharkie.

“I welcome the Government’s commitment to increase the current excise refund scheme for craft distillers from $100,000 to $350,000,” Rebekha said.

“This measure takes the first step towards placing small distillers on an equal tax footing with wine producers. It was a key component of the tax relief package that I and my fellow crossbench colleague Andrew Wilkie, the Member for Clark, have been advocating for on behalf of the boutique distilling industry which is being held back by an unfair tax regime.

“We would like to thank the Treasurer Josh Frydenberg for meeting with us back in March and we would like to thank Assistant Treasurer Michael Sukkar for working with us and the small distillers as we presented the case for a fairer tax regime

“Increasing the current excise refund scheme will allow our distillers to make those crucial investments in their businesses. Investments such as plant and equipment, employing new staff or covering the costs of exporting which will allow them to put their products on the world stage.

“I now call on the Government to also cut the spirits excise to the brandy rate and freeze the spirits and brandy CPI indexation for three years to provide the full measure of tax relief for this growing industry.”

Modelling commissioned by the industry shows the tax on spirits is now so high it is having a perverse impact on consumer behaviour with Australians buying fewer local products because of the higher price.

Rebekha said the tax regime on spirits was a legacy from the time when the vast majority of hard liquor was imported from overseas and the Government was attempting to incentivise the local wine and brandy industry.

“We all recognise the importance of the wine sector in regional Australia and the significance the industry has for our international reputation for quality," Rebekha said.

“In recent years, we have witnessed the development of craft breweries and distilleries.

“A decade ago, we did not have a single commercial distillery in Mayo. Today, more than a dozen craft distilleries operate and, like their wine cousins, are among some of the best in the world, producing some of the finest craft gin and whisky on offer.

“There are more than 300 locally owned distilleries across Australia, supporting more than 5,000 direct jobs and a further 15,000 indirect jobs.

“This growth has occurred despite the inequitable application of the spirits excise causing unnecessary financial burdens on hardworking Australians.

“The changes for craft distillers Andrew Wilkie and I put to the Treasurer and Assistant Treasurer just bring the sector in line with what is available to small winemakers.

“We received a positive hearing from the Treasurer and I remain hopeful that the Government will introduce all our proposed changes in the context of the 2021/22 Budget in May.”

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