Craft brewers get short shrift on beer tax

Craft beer has a powerful story to tell.
Craft beer has a powerful story to tell.  Photo: Pat Scala

There are many differences between beer and wine but none of them explain the short shrift that small brewers get from the government compared with their winemaking counterparts.

Perhaps it's the monumental success of anodyne lagers produced by the industrial brewing industry that has led to the low esteem in which beer is held.

Brisbane-based beer educator Matt Kirkegaard.
Brisbane-based beer educator Matt Kirkegaard. Photo: Supplied

Or perhaps it's marketing that has always portrayed beer as blokey, by-the-six-pack booze, compared with wine advertising with its evocative images of misty morning vineyards and urban sophisticates raising their Riedels.

How else to explain why the craft brewing industry receives so little government support compared to the wine industry and why beer is taxed so heavily?

Wine is taxed on a value basis. Wines with the same alcohol content are subject to different levels of taxation and the cheaper the wine, the less it is taxed. Beer, on the other hand, is taxed based on its strength. The Henry Review into Australia's tax system recorded that a two-litre wine cask that costs $10.99 will attract $1.59 in tax. An equivalent volume of alcohol in full-strength beer would attract $7.48 in excise.

Added to this price advantage, small winemakers get a break on the tax they pay.   They can claim up to $500,000 a year in tax rebates while small, independent brewers can only claim a maximum of $30,000 a year.

This is serious coin that can be invested in the business and used to employ staff.

The wine industry has traditionally painted a favourable picture of itself, but craft beer has a powerful story to tell too.


Craft beer is an agricultural product. Hops and barley are grown here and are both benefiting immensely from the rise of craft beer.

The Australian hop industry would have died more than a decade ago had it not been for craft beer. Now growers, such as Hop Products Australia, are world leaders in breeding new aromatic and flavouring hops for beer. This has seen major investment in the industry, record acreages under hops and flourishing export markets.

Craft beer is reinvigorating our barley growers as well. Growers have incentives to produce high-quality barley for malting and some, such as Voyager, based in the Riverina, NSW, are investing in malting facilities to cater to the growing demand for premium malts.

Craft beer creates jobs. Carlton United Breweries (owned by multinational company Anheuser-Busch InBev) employs about 1600 people and makes 42 per cent of the beer produced in this country. Craft brewers produce less than 5 per cent and employ more than 2400 men and women.

The small brewing sector employs 40 people for every million litres of beer brewed while the hyper-efficient centralised brewers employ only 0.5 people to brew the same amount.

And unlike wine, beer can be made anywhere, rather than just where the ingredients are grown. This means the economic, tourism and social benefits of small breweries can be spread across the country rather than clustered in specific regions.

Craft beer has a powerful story to tell. Small brewers have begun to tell that tale. But it's time for state and federal governments to start to listen to reap the rewards of a dynamic business sector.

Matt Kirkegaard is a Brisbane-based independent beer educator.