Labor Announces 2 Year Freeze on Draught Beer Indexation, Coalition Matches

Australians now pay almost $20 in tax for every slab of beer.

A bartender pours a beer from a tap. HOLLIE ADAMS/AFP via Getty Images

Labor and the Coalition have both announced plans to freeze the indexation on draught beer excise for two years, following calls from beer drinkers, breweries, and hospitality businesses.

For decades in Australia, the tax on alcohol has been subject to indexation twice a year.

February 2025 indexation saw the pub beer tax increase from $43.22 (US$26.83) per litre to $43.39.

Australians now pay almost $20 in tax for every slab of beer bought in the bottle shop and pub, according to the Brewers Association of Australia. This also includes the goods and services tax.

Australian Prime Minister Anthony Albanese said Australia needs to support its small and medium local businesses to help the future of the country thrive.

“Freezing the excise on draught beer is a common sense measure that is good for beer drinkers, good for brewers, and good for pubs,” Albanese said.

Treasurer Jim Chalmers added that, “This is a modest change but will help take a little bit of the pressure off beer drinkers, brewers, and bars.”

Implementing the Freeze

Labor said indexation on draught beer will be frozen for two years from the next upcoming indexation date in August.

The government will consult with the industry sector on its implementation.

Labor said the freeze will relieve pressure off the price of a beer poured in pubs, clubs, and other venues, supporting businesses, regional tourism, and customers across Australia.

In addition to the freeze, Labor announced new tax relief for Australian distillers, brewers, and wine producers.

Currently, distillers and brewers get to cancel up to $350,000 of any excise paid, but Labor said it will increase the excise remission cap to $400,000.

Labor will also increase the Wine Equalisation Tax producer rebate cap to $400,000, from July 1, 2026.

Coalition Matches Freeze

In his announcement promising to do the same, Opposition Leader Peter Dutton said pubs, clubs, and restaurants are struggling.

“The cost of everything has gone up, and small businesses are paying the price,” Dutton said.

“We’ll freeze the tap beer excise for two years—stopping automatic tax hikes that drive up costs for pubs, clubs, and breweries. This means lower costs for businesses and a better deal for customers.”

The promised freeze has been announced in the lead up to the federal election, which must happen by May 17, but could happen as early as mid-April.

In the latest YouGov poll, the projected vote share between Labor and the Coalition was 48.9 percent and 51.1 percent respectively.