The reason why beer is so expensive in Australia
If you've ever thought the cost of your favourite beer has increased recently, you're not wrong.
As with many common products, alcoholic drinks have gone up in price as inflation and the cost of living have grown.
While the rising price of the products required to brew and package beer – such as barley, and aluminium – is behind some of the price spikes, there's another reason for the steep price of a schooner in Australia: tax.
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Australia has some of the highest rates of beer tax in the world. AP Photo/Nam Y. Huh
How much does Australia tax beer?
According to the Brewers Association of Australia, only three countries in the world have a higher beer excise than we do: Norway comes in at number one, followed by Japan and then Finland.
While the exact rate of taxation varies by product (pre-packaged products like cans and bottles are more heavily taxed than kegs of draught beer, for example), the Brewers Association says the excise per litre of alcohol ranged from $1.59 to $2.26.
However, those figures come from 2020 data, and the excise has increased since then.
In fact, Australia's beer tax rises twice every year, as it is indexed to inflation. Every time inflation rises, so too does the excise.
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Australia's beer excise rises in line with inflation twice every year. Bianca De Marchi/The Sun Herald
How much of the price of beer is made up of taxes?
The excise isn't the only tax placed on beer in Australia. Like other products, the Goods and Services Tax (GST) of 10 per cent also applies to alcoholic drinks; this is added to the cost after the excise has been applied.
As a result, almost half the price of beer is made up by taxes; 42 per cent, according to the Brewers Association.
How much does the government make from taxing beer?
In 2020-21, the Australian federal government received $2.5 billion in excise and customs duty on beer.
However, this does not include the GST on the excise and beer sales, which in previous years the Brewers Association said added another roughly 65 per cent to the total figure.
(It said, in 2018-19, taxes made the government $3.593 billion – $2.01 billion in excise, $201 million in GST on the excise, and then $1.3 billion in GST on retail beer sales.)
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While Australians tend to pay more for beer than most other countries, we don't have the most expensive prices in the world. Wolter Peeters
How expensive is beer in Australia compared to the rest of the world?
While there's no definitive ranking of beer prices by country, Australia does seem to have more expensive beer than average.
Data from the World Bank's International Comparison Program from the past five years said the price of alcohol in Australia is 85 per cent above average, good enough for 23rd most expensive in the world, while Finder in 2018 said the average cost of a pint Down Under was $USD6.04, which was the 27th most expensive.
More recently, the World Beer Index in 2021 ranked 58 countries by the price of their beers, but unfortunately, Australia wasn't included in that study.
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One country that was, though, is Qatar, which was found to have the priciest beers in the world.
According to the study, the average price for a 330ml bottle in the gulf state was a whopping $USD11.26 – although it should be noted that, under Qatar's interpretation of Islamic law, the sale of alcohol is heavily restricted.
It's only available for purchase at licensed venues, and there's a permit system for expatriates living there who wish to buy alcoholic drinks.
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