According to Spirits & Cocktails Australia, the Australian market will miss out on the economic opportunity presented by its promising spirits manufacturing sector without urgent intervention by the Federal Government. This was also evident when heard by the Inquiry Into Food and Beverage Manufacturing in Canberra.
Peak industry bodies Spirits & Cocktails Australia and the Australian Distillers Association appeared before the House of Representatives Standing Committee on Industry, Science and Resources at Parliament House.
Australian Distillers Association chief executive Paul McLeay said the Australian distilling industry should be integral to the government’s Future Made in Australia policy.
“However, the Government’s outdated policy settings and inaction has placed Australian-made spirits at a significant competitive disadvantage in our home market and abroad,” said McLeay.
“Just as previous governments recognised the potential of Australian wine, with the right policy settings and infrastructure, Australian spirits can realise a $1 billion export opportunity by 2035. If we do not act now, Australian distillers will be outpaced by other emerging spirits markets in meeting growing consumer demand for premium products – and Australia will miss out on the economic windfall that could be ours.”
Spirits & Cocktails Australia director Nicole Lestal said the Government must release the handbrake that is the current excise regime.
“While Australian spirits account for 20 percent of alcohol consumption, it accounts for 50 percent of alcohol taxes. This structural disadvantage impedes innovation and opportunities to re-invest in Australian spirits manufacturing," she told the committee.
“Our global spirits industry experience tells us that when governments act decisively and across multiple fronts to provide coordinated support, it incentivises investment to achieve scale and unlock further opportunities for economic value-add and innovation.”
Mark Hill, treasurer of Spirits & Cocktails Australia and managing director of Suntory Global Spirits Oceania, said Suntory Oceania’s new AUD 400 million carbon-neutral facility in Ipswich, Queensland, provides the Committee with a real-time example of the positive impact that direct foreign investment can have on the Australian food and beverage manufacturing sector.
"However, there is little or no incentive for global spirit companies to invest in the expansion of the Australian spirits industry while our excise rates are so overwhelmingly uncompetitive with other countries like Japan, the United States, Ireland, Scotland and Mexico.”
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