Friday, June 27, 2014

Australia's Comical Excise Tax

No exploration of bad liquor laws can leave out Australia's absurd excise tax system for beer. Apparently it derives from some appalling political grandstanding. Beer in vessels larger than 48 litres, which effectively means beer in 50 litre kegs, are charged significantly lower excise. It was made this way so that after the application of GST in 2000 beer in pubs could return to pre-GST prices.

The anomalies and penalties that it creates are innumerable. One good one example was explained to me once. Excise is paid when beer leaves a brewery or when it's imported. At a shop that offers growler fills, when beer is taken from a keg to a growler it's considered that it is now being sold in a vessel smaller than 48 litres. So the rate of excise that was originally paid on the 50L keg is suddenly wrong. So the retailer has to figure out the new excise that should be paid on the volume in the growler and collect the difference. Of course if the beer had gone into a glass and was consumed on the premises, then this higher excise rate wouldn't apply. (Yes, even though a glass is a vessel that the beer is sold in that is smaller than 48 litres.)

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