Craft brewers applaud Budget 2012

09 May, 2012 by

By James Atkinson

Craft brewers are unanimous in their praise of the Federal Budget's excise reforms for microbreweries, which they believe are a crucial step forward for the industry.

Advertisement

The Federal Government announced it will extend the current microbreweries excise refund scheme by increasing the maximum refund amount from $10,000 to $30,000 and removing the current production eligibility threshold of 30,000 litres of beer, with effect from 1 July 2012.

"The amendments will allow breweries to receive an excise refund of 60 per cent of excise paid, up to a maximum amount of $30,000 per financial year," the Government said.

"They will also ensure that the refund does not penalise successful local breweries as they expand their production."

Craft Beer Industry Association co-founder Jamie Cook told TheShout the reforms were an important indication of the government's intent to support small craft brewers.

"There's been a lot of brewers lobbying over many years, and given the challenging times the Government's facing, and the economic times we're living in, to get some sort of relief is certainly a positive step," he said.

David Hollyoak, chairman of the Australian Real Craft Brewers Association (ARCBA) – which exclusively represents Australian-owned craft brewers – told TheShout the changes will put $10 million back into the industry of small craft brewers.

"It hasn't gone to the level that we thought it needed to move to, but it's a good step," he said.

Hollyoak said the excise relief for craft brewers will still be a long way behind most other developed countries.

"We'll keep moving forward, but this is the first change for 12 years so we're excited that they have actually listened to us," he said.

Owen Johnston, of Tasmania's Moo Brew, said Independent MP Rob Oakeshott and Greens leader Christine Milne deserve recognition for their work in getting the reforms across the line.

"The big win for me out of this is the removal of the [30,000 litre] threshold for the refund," he said.

"This is a meaningful change to the small brewery business model that will help regional employment. It means that our small and local breweries that are successful and have a product that the customers want are not faced with a hurdle as they grow."

Jane Huntington, of Tasmanian craft brewery Two Metre Tall agreed that the removal of the cap is "a wonderful acknowledgement that we need to encourage growth in the microbreweries sector".

"I've personally been lobbying government for the last five or six years and I've not been convinced until today that they're listening," she said.

But Huntington said the increase in the refund to $30,000 hasn't gone far enough.

"It does take some cash flow pressures off us, but it doesn't even pay for half an employee."