Breweries told to absorb excise tax increase

Breweries should absorb the 1.6% increase in excise tax that is expected linked to budget indications, says Adam Cunningham, President of Hospitality New Zealand. Breweries have already increased their prices once already this year and should now absorb the excise tax increase.

The increased prices, announced by Lion days before the budget, hits bars and restaurants hard - very hard. From the pricing we see in the supermarkets it is clear that the breweries have already discounted the last price increase back to these customers. It’s time they gave the smaller customers the same break.

Mr Cunningham said that a 1.6% increase in the tax amounted to a mere 6 cents a dozen of beer or 82 cents on a 50 litre keg.

It is time to give the consumers a bit of a break and for the breweries to share the pain of ongoing increases. Brewery increases in April of 3.5% amounted to the equivalent of 63 cents a dozen of beer, or around $4 a keg.

The magnitude of the April increases means that breweries should be able to absorb what is a modest increase in excise tax, said Mr Cunningham.

About the Hospitality New Zealand
Hospitality New Zealand was established in 1902. It is a voluntary trade organisation of like-minded businesses and operators in the hospitality sector that is governed by a Board of nine elected members and owned by its members. Hospitality New Zealand continues to be the voice of Hospitality, representing over 2,400 hospitality businesses, providing significant advocacy work, expert advice and a range of services to its members at both local and national levels. See www.hospitalitynz.org.nz.

ENDS