Why your next case of beer is about to cost even more

Australia has been named the most expensive country in the world to drink a beer, according to a new report.

And the pain is set to continue with the bi-annual alcohol excise on bottled and canned beer set to increase next month.

Industry leaders are calling on the Albanese government to freeze the so-called “beer tax” on bottled and canned beer. The alcohol excise on tap beer has been frozen until 2027.

“From a retail standpoint, the price just keeps going up,” Evin Craney, chair of Australia’s Independent Brewers Association, told nine.com.au.

“The problem here is we’ve actually gotten past the point where it’s a conversation around taxation, and it’s more of a conversation around taxation.

“We’re actually at the point where doing good by minimising and harm-reducing is just completely shutting out industry ... that’s the hospitality sector and the retail sector and agriculture.”

Melbourne the most expensive city in the world, followed by Sydney

According to Deutsche Bank’s Mapping the World’s Prices Report published on July 13, which is also known as the “Oasis Index”, measured the cost of five beers across 69 major global cities.

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Melbourne was found to be the most expensive city in the world for beer, with Sydney coming in second.

Over the past five years (2021 to 2026), the price of a standard bottle or can of beer in Australia has increased by roughly 18-25 per cent on average, in part due to the alcohol excise, as well as an increase in the cost of production and transport.

This means smaller local beer producers are bearing the brunt.

Smaller local producers are being priced out

Sam Hambour from Melbourne brewery Hop Nation has told nine.com.au said it is becoming harder to absorb the alcohol excise increases, leaving them with no choice but to pass some of the cost on to customers.

“There’s a point where beer is becoming more and more of a luxury because of the price point,” Hambour said.

“It makes it tougher for us to supply the people that want it, but then the price becomes such a deciding factor in their purchasing habits.

“Buying a round of beers for your friends now, often people look down at their feet when it’s their turn.”

Despite the increases, Hambour said his business continues to grow.

“COVID and post-COVID were quite tough years, but people seem to be socialising again, especially in pubs and bars. And people still treat themselves. But I think especially for younger people, paying for a couple of pints of beer has to be thought twice about.”

The exact amount by which the alcohol excise is increased isn’t announced until days before and is reportedly “in line with inflation”, leaving brewers like Hambour to budget in an estimate.

Hambour has budgeted for a 3.5 per cent increase, but is expecting the increase to be less.

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Craney told nine.com.au it is getting to the stage where it is going to be impractical for any small business to be able to operate in this sector.

“We’re going to be left with two foreign breweries, mega breweries that are going to minimise the product opportunity that goes out there and consumers are going to have less opportunities to come.”

As of February 2026, the excise tax on packaged beer (bottles and cans) has been increased automatically 86 consecutive times.

The days of shouting a round of beers with friends are over

Craney said it has now hit the point where consumers are going to feel the price increases in “a more aggressive sense”, and Australians are drinking less beer as a result.

“You can see it every time there’s been movement around taxation for alcohol. And we can see that already with how people are purchasing and the levels they’re purchasing at, the price points that they’re willing to purchase at from pre-economic downturn to what they are now.

“And so what’s happening here is that the way that the tax is piling on has actually meant that consumers are now starting to move away from beer, clearly from a financial perspective, and moving to what could potentially be more dangerous drinking habits.”

Both Craney and Hambour expressed concerns this may lead to a black market in beer.

Retail Drinks Australia CEO Michael Waters told nine.com.au the organisation supports calls for a freeze on alcohol excise across all categories, whether in a retail setting or at a bar.

“The tax freeze on draught beer also doesn’t address the burden facing households buying alcohol to take home and creates artificial distortion across the sector.

“Consumer budgets are already stretched, and while cost-of-living pressures remain, we see consumers being pushed toward cheaper alternatives, including illegal alcohol.

“If the government wants to be serious about easing cost-of-living pressures, an across-the-board alcohol excise freeze makes the most economic and practical sense and would provide genuine relief to Australian families.”

Assistant Treasurer and Minister for Financial Services Daniel Mulino told nine.com.au: “The Albanese Labor Government froze the draught beer excise for the first time in 40 years to deliver cost of living relief to Australian beer drinkers and support the hospitality industry. 

“We’ve also provided support for distillers, brewers and wine producers.”

When asked by how much the excise will increase on August 3, Mulino said: “Excise indexation will be announced in the usual way.”