Brewers call on Government to 'give us a break' on alcohol excise

The brewing industry is calling for the Government to ease up on excise tax after the failure of two Auckland breweries in recent weeks.

Epic Brewing has gone into liquidation while Brothers Beer has been put into voluntary administration.

But brewers say they're being squeezed by rising costs and taxes.

Epic Beer has been a fixture in Ōnehunga, Tāmaki Makaurau, since 2006.

"I'm making beer because I like it. I'm making beer with flavour because I like flavour. I'm not doing it for price," said the brewery's owner.

The business is now in liquidation due to rising prices, the COVID-19 pandemic, and the recession.

Brothers Beer chose to expand into the bar and restaurant sector just before COVID-19 arrived in Aotearoa.

They have struggled but will continue to sell their beer in the hope they can trade their way out of trouble.

New Zealand has 200 breweries all facing rising costs and interest rates, and some of them say the Government isn't making it easy.

"The plea to the Government is: Just give us a break on excise. We are doing our best here to create new jobs and grow businesses," Brian Watson from the Brewers Guild told Newshub.

Brian Watson from the Brewers Guild wants the government to 'give us a break' on alcohol excise.
Brian Watson from the Brewers Guild wants the government to 'give us a break' on alcohol excise. Photo credit: Newshub.

Excise is a tax added to all alcohol brewers produce and sell domestically.

The Government bumped it up on July 1 by about 7 percent.

Hoppiness craft beer expert Michael Donaldson told Newshub it hurts and is hard to plan for.

"Excise… You don't know it until it's about to hit."

"It gets announced a few months before - it's going up by 6.65 percent or whatever it was this year. [It was] 6.7 percent last year and that's a big factor that kicks in here," he said.

Both the United Kingdom and Australia have eased excise regulations, but that's not the case in Aotearoa.

Add in factors like the soaring cost of CO2 (carbon dioxide) which is vital to the brewing process, and many are frothing with anger.

"We had that huge shortage and crisis," said the Garage Project's Jos Ruffel.

"The costs went from $1600 per tonne two years ago [for CO2], to over $6000 a tonne now. So [there are] a lot of cost increases and pressures on the industries at the moment," he added.

As for the future, there's a lot of resilience in the industry and breweries continue to open.

But for the mid-sized players who have to rely on supermarket sales, price is everything - and that's where it's cut-throat.