Ever wonder why whisky and other spirits were so expensive? It's because of an unfair taxation/excise system that will probably cause most local distilleries to go out of business in the next few years. Baiscally, wine is taxed based on the wholesale price, so whatever price you decide to sell the wine to your distributors determines you tax payable. But for alcohol produced using other food products, the excise is charged based on the amount of alcohol in your finished product (and at differing rates depending on whether you use grapes, other fruits or grains to produce your booze). So...

 

For a standard drink (10g of alcohol, or 12.5ml) after February 1 2021:

 

For a standard drink (10g of alcohol, or 12.5ml) after February 1 2023:

For a standard drink (10g of alcohol, or 12.5ml) after August 1 2023:

  

 

Bearing in mind, this is for exactly the same amount of alcohol (yes, some wines have more % and some less, but this was using two specific wines).

 

Taking into account that inflation may be at 4% for the next few years, It's estimated that 'boutique' gin distillers will probably have to sell their products at a loss in the next two years and whisky distillers in the next 4 or so. There are alternatives, such as raising prices (so they compete even less against overseas competition), producing less so as to be able to survive using the Excise remission scheme, reducing the alcohol level, going into the "value add business" (restaurants, liqueurs, etc.), going to export only model...none of which are palatable (pun intended) to the local buyers.

 

So, get in quick, before they stop making it altogether.

 

Note that this isn't the first time the government has taxed our distilling industry out of existence (remember Gilbey's Gin in Moorabin?)

Edited August 21, 20232 yr by Cloth Ears

 

 

Quote

It's because of an unfair taxation/excise system that will probably cause most local distilleries to go out of business in the next few years.

 

Alarmist. The tax and excise index factor are well known. You need to credit the industry with more resilience. Notwithstanding the taxation and excise aspects (that is one of many aspects of running a business) the distilled spirits market has demonstrated growth. The forecasts are for more growth, that may slow, but you are not going to see the death of the distilled spirits in Australia. You can expect higher prices, and if the "craft" product is one of quality, it will justify such price increase and the consumer will buy it. 

 

Relax and enjoy your Jimmy Rum mate!

Most Aussie spirits are beyond my capacity nowadays. In just a handful of years my daily drinkers have all become "for special occasions only" however that said it's nearly the same for imported spirits also. Decent Scotch whisky jumped the shark approx. 6 years ago with increases of around $50 - $70 (Talisker, Ardbeg , Laphroaig etc. all in the $100+ range now) and bourbon is rising sharply also.

 

Good news it its forced me to stop and now I rarely touch a drop  although a big birthday next month may just tempt me to crack open my Bruichladdich DNA first release cask strength bottled at 38yo back in 2008.

13 hours ago, Cloth Ears said:

Ever wonder why whisky and other spirits were so expensive? It's because of an unfair taxation/excise system that will probably cause most local distilleries to go out of business in the next few years. Baiscally, wine is taxed based on the wholesale price, so whatever price you decide to sell the wine to your distributors determines you tax payable. But for alcohol produced using other food products, the excise is charged based on the amount of alcohol in your finished product (and at differing rates depending on whether you use grapes, other fruits or grains to produce your booze). So...

 

For a standard drink (10g of alcohol, or 12.5ml) after February 1 2021:

 

For a standard drink (10g of alcohol, or 12.5ml) after February 1 2023:

For a standard drink (10g of alcohol, or 12.5ml) after August 1 2023:

  

 

Bearing in mind, this is for exactly the same amount of alcohol (yes, some wines have more % and some less, but this was using two specific wines).

 

Taking into account that inflation may be at 4% for the next few years, It's estimated that 'boutique' gin distillers will probably have to sell their products at a loss in the next two years and whisky distillers in the next 4 or so. There are alternatives, such as raising prices (so they compete even less against overseas competition), producing less so as to be able to survive using the Excise remission scheme, reducing the alcohol level, going into the "value add business" (restaurants, liqueurs, etc.), going to export only model...none of which are palatable (pun intended) to the local buyers.

 

So, get in quick, before they stop making it altogether.

 

Note that this isn't the first time the government has taxed our distilling industry out of existence (remember Gilbey's Gin in Moorabin?)

Well said mate.

Seems that we are getting ripped off at every level, albeit whether it's booze, records, 

Cds. Pretty much all luxury items for a lot of people these days.

 

The disappointment for me is that every new government voted in say they will expunge what the previous government stood for...but we get same old.

Just glad I've got a roof over my head. Sad times.

 

Simple 

 

Drink cask wine!!  😁

5 hours ago, metal beat said:

Simple 

 

Drink cask wine!!  😁

 

Ouch!

13 hours ago, The Fez said:

 

 

 

Alarmist. The tax and excise index factor are well known. You need to credit the industry with more resilience. Notwithstanding the taxation and excise aspects (that is one of many aspects of running a business) the distilled spirits market has demonstrated growth. The forecasts are for more growth, that may slow, but you are not going to see the death of the distilled spirits in Australia. You can expect higher prices, and if the "craft" product is one of quality, it will justify such price increase and the consumer will buy it. 

 

Relax and enjoy your Jimmy Rum mate!

Sorry to burst your bubble, but this is basically what the distillers are going to the federal government with at the moment. The options I mentioned are those that they facing at the moment. They guys I do markets for are currently making about $5/bottle, down from $15 about 5 years ago. And they'll be in the red in less than 4 years.

 

So, if I'm alarmist, it's only because it's true - even Bundaberg and Beenleigh have been holding COW meetings with their boutique fellows about this in Queensland.

 

And why don't the wine people chip in to help? Because it benefits them more than anyone - they don't pay excise on the alcohol, only on the wholesale price that they sell the bottle/cask for.

 

P.S. That growth that you talk about, that only works if they can keep selling at round the same price. If they have to mark up their already expensive prices, then people will go to the overseas product. As I was saying (or maybe I didn't make it clear), this happened in the 70's - the high tax rate for distilled product nearly wiped out the entire industry in Australia...

Edited August 22, 20232 yr by Cloth Ears

7 hours ago, metal beat said:

Simple 

 

Drink cask wine!!  😁

 

Make it a student's brief case for my mate, and I'll have a box of bad manners thanks 🍷 😬

Some more alarmists - including the beer people:

https://www.theleader.com.au/story/8133533/taxed-to-oblivion-australian-distillers-on-the-brink/
https://www.drinkstrade.com.au/spirits-excise-increase-a-devastating-blow-to-industry
https://theshout.com.au/calls-for-reform-as-alcohol-tax-rises-again/
https://australiandistillers.org.au/resources/Documents/Policy/1 August 2023 Resource Handbook.pdf
https://www.9news.com.au/national/alcohol-tax-spirits-manufacturers-plead-for-government-help-ahead-of-next-alcohol-tax-increase/4105289a-ffed-40b7-baca-654b4b4e3902
https://thenewdaily.com.au/finance/finance-news/2023/07/23/alcohol-tax-australia/
https://www.delicious.com.au/drinks/news/gallery/new-alcohol-tax-send-send-cost-spirits-soaring/plx39lse
https://www.news.com.au/lifestyle/food/drink/brewers-slam-out-of-control-beer-tax-increases/news-story/e0e5ed8ed24cdc95216466fce38cb02a

 

Getting depressed now....think I'll have have a glass of red...

 

Love a nice red. Love my music. Bargains are still out there, if you are willing to look.

In fact, just purchased a carton of mixed red for $56 on the MyDeal site. And it comes with free delivery. Decent stuff too.

I think they are still going through the backlog of Chinese cancelled orders?

 

Last week, l picked up a new record on eBay for $24 shipped. And RareWaves have some great savings on their CDs, if you are prepared to be patient on their long delivery times.

 

Always tried to support local record stores. But l now can't afford, what on average, is $60 for a single LP. Even CDs are now selling for $24 and upwards. Remember when JBs used to mark down their new releases to $10-$15, after a few months.

 

So. Decided to curtail my music spending. Just listen to what l already have. Which is over 3000+ CDs and probably 200+ records (stopped counting years ago). Even if play a couple of albums a day, l still wouldn't get through that backlog before l popped my clogs. Ha. 

 

Currently saving for a decent overseas holiday. Might take a couple a years......

 

Oh. And still hopeful of attaining my dream speakers.

Dream on!!!

One Power Ball😍