Craft Distillers Tax

[FatManDancing]

One of the measures in the budget last night was a change in the tax regime that craft distillers are subject to

Instead of 60% rebate on tax up to, from memory, $100,000 it is now a 100% rebate up to $350,000 of taxes paid


What does that mean for us the home distiller? Please correct me if I am wrong but it seems almost like the federal government is saying they really do not care about the amount of tax they were once able to raise through liquor and therefore do not care about home distilling

I have not read any fine print, just the headline on the ABC winners and Losers post about the federal budget and I am certain any push to legitimize home distilling would be met with a barrage of health and community experts telling us what is really in our best interest


This seems like really good news though

[Sam.]

The bigger "craft distillers" in Australia probably smash that $350,000 in no time, government gets 100% of the excise after that.

It's intended to let the industry flourish like the wine industry did years ago with the WETS tax.

Also its not just distilleries its also breweries, expect to see a surge of new start ups in the next 12 months.

[RC Al]

intresting..
https://budget.gov.au/2021-22/content/f ... et_tax.pdf

"From 1 July 2021, all eligible brewers and distillers
will receive full remission (up from 60 per cent) of
any excise they pay on the alcohol they produce
up to a cap of $350,000 each financial year
(increased from $100,000)"

Thats about 14,000 bottles of plonk with no tax, great news for small producers indeed, I can see another few hundred opening up now and increasing competition though. ( :D says Stig lols)

On the home distilling front, it you can pony up what the ato & your council requires for aprovals (secure premises, food grade kitchen, waste disposal etc), you could in theory pay the tax for what leaves your bonded area and then get refunded. Depending on where you live and the council involved, it could actually become a reasonable path to legality for a lucky few with some $$ to blow - a "private" legal distillery as such.

[FatManDancing]

All that is true but again where does that leave us?

I can not and will never be big enough to even come close to paying that amount of tax on what I can produce. Upped my game by buying a coupla 60L fermenters and that is a major upgrayyedd!!... :mrgreen:

To me this seems like the complete abandonment of trying to police home distilling on a federal level, ie; expect to see a surge of startups


On the state level though... Watch South Australia Fuck it all

[RC Al]

On the other hand, it might just be that you see a bunch of sub $20 bottles available at liquor stores soon and a reduction in home distilling subsequently.. I could see it affecting t500 sales more than the real gear though.

With the bonded area setup, you only pay duty on what goes outside the cage/secure area, you could have 100l in there as long as its all logged and not pay a cent in duty til it leaves.

[Wellsy]

I suspect like others have said the government can see some future income by supporting at fledgling industry. I do not believe they are looking at legalising anything but rather growing those who want to get in for future income.
Also if they change the industry once they can change it again so they are looking to restart industries after covid with what ever subsidies they can can.

[Sam.]

All that is true but again where does that leave us?

I can not and will never be big enough to even come close to paying that amount of tax on what I can produce. Upped my game by buying a coupla 60L fermenters and that is a major upgrayyedd!!... :mrgreen:

To me this seems like the complete abandonment of trying to police home distilling on a federal level, ie; expect to see a surge of startups


On the state level though... Watch South Australia Fuck it all

Mate the sooner you realize that home distilling is still currently illegal in Australia and if you want to stick your head up from the fox hole expect it to be blown off the better.

Like said though if you wanted to go through all the processes of council, ATO and licensing you could potentially have a legal home distillery because you could claim back all the excise.

[southern45]

Nothing to do with the home distiller. The announcement is a solid boost to anyone in the early stages of starting their small distillery business venture, that can only be a good thing. Expect to see a whole bunch of new craft distilleries popping up over the coming years as the industry grows (like the wine industry did as said in a post above). Lots of new small match distilleries, hopefully lots of interesting new products.

For a number of people "on the fence" about starting their own business, this could be the extra nudge that makes it worthwhile and cost effective.


And this ...

To me this seems like the complete abandonment of trying to police home distilling on a federal level, ie; expect to see a surge of startups

Mate the sooner you realize that home distilling is still currently illegal in Australia and if you want to stick your head up from the fox hole expect it to be blown off the better.

:text-yeahthat:

[FatManDancing]

Hi Sam

I think I offended you by slamming South Australia. my intention was not to cause you harm or aggravation but to point out the terrible record South Australia has in killing emerging industries. Some of the biggest retailers of vape products were based in Adelaide until they were effectively kicked out. They moved to Vicco


For the record, I am South Australian. I may have been born in Penrith Hospital but I spent 40 years growing up and living in S.A. That is something people do not lie about



However


I find it rather ironic and a bit disturbing that the site admin of an Aust. stillin forum would try to shut down any talk of the legalization of stillin


I get it though. You have been down this path several times before. I think this time is different. Sure the tax rebate applies to craft distillers and brewers but I am of the opinion that the Federal Government has come to the realization it can no longer base their collection of taxes on chickens and booze


Trickle down economics usually does not work and maybe I am a bit naive but I am still of the opinion this could lead to something big


Respectfully,

[bluc]

Nope and i doubt you would even get a license unless it was a legit
Buisness with good figures..or backing.
We would all love it to be legal but reality is cunts make to much outta tax to ever give us a free ride..

[FatManDancing]

The ATO website currently states that they do not generally grant a licence to home distillers

They do not make the laws, only apply them so if the law changes....

[Sam.]

Hi Sam

I think I offended you by slamming South Australia. my intention was not to cause you harm or aggravation but to point out the terrible record South Australia has in killing emerging industries. Some of the biggest retailers of vape products were based in Adelaide until they were effectively kicked out. They moved to Vicco


For the record, I am South Australian. I may have been born in Penrith Hospital but I spent 40 years growing up and living in S.A. That is something people do not lie about



However


I find it rather ironic and a bit disturbing that the site admin of an Aust. stillin forum would try to shut down any talk of the legalization of stillin


I get it though. You have been down this path several times before. I think this time is different. Sure the tax rebate applies to craft distillers and brewers but I am of the opinion that the Federal Government has come to the realization it can no longer base their collection of taxes on chickens and booze


Trickle down economics usually does not work and maybe I am a bit naive but I am still of the opinion this could lead to something big


Respectfully,

Actually had to go back and see why you referenced SA. Couldn’t give a fuck, all states bow to the same federal manufacturing license, states only dictate how you sell it.

And for the record I or we at AD are not trying to shut down anyone trying to legalize home distilling, but if you think this forum has any power to lobby anything then you are deluded.

If you want to start a change I would suggest talking to your local MP and going from there.

Having said that I would bet the vast majority of members here are happy to make excellent spirits at their own homes and consume them with family and friends and have a great time without worrying about the government.

[BSC_Kilby]

All that is true but again where does that leave us?

I can not and will never be big enough to even come close to paying that amount of tax on what I can produce. Upped my game by buying a coupla 60L fermenters and that is a major upgrayyedd!!... :mrgreen:

To me this seems like the complete abandonment of trying to police home distilling on a federal level, ie; expect to see a surge of startups


On the state level though... Watch South Australia Fuck it all

It's absolutely not abandoning policing it. The industry has made a big push to get this policy change done and it has zero to do with home level. There are huge well-funded lobby groups that make it very clear to politicians every day of the week that alcohol is being abused and causing harm to people who are susceptible to addictions. It's very popular across the board to come down hard on the alcohol producers and you could draw an argument that the industry will be now more willing to help identify home producers to preserve the slim benefit that commercial producers were just given.

Further to the comment about setting up legally at home, your biggest hurdle is not the taxman it's energy safe in your state. unless you live on a large rural property you are incredibly unlikely to be able to achieve the separation distances and fire ratings required. A large number of newer setups are only just becoming aware that they have opened without being compliant and the cost of retrofitting their business is potentially enough to shut them down. If anyone is interested in reading the onerous requirements I know where you can find a copy of the standard for storing and handling flammable goods which is a primary document that all sites have to be compliant with.

[FatManDancing]

Well Sam it appears you may be right, I am deluded, just not about the thing you thought I was. I will never ask nor did I expect Members of this forum to try to lobby for legal home stillin. You know and I know that is just not how this works

The weight of opinion is against me and those who have added their opinion are far more knowledgeable than me on this matter and to all of you I say thanks for your contribution

Eventually this country is gonna have to have a long and serious talk about the way we talk about drugs. In NZ it is leagl to vape nicotine ( you could buy nicotine at Bunnings until 2009 until the govt reclassified it as a poison on the same level as heroin) and still, in the U.S.A. laws around the use of weed are changing so fast it will make your head spin but as BSC Kilby pointed out and something we already knew there are well funded lobby groups working daily to make some of the things we enjoy harder to obtain and more expensive

To me, legal stillin will not be driven by any sort of lobby group representing, it will be driven by the craft industry lobbying for further tax breaks and incentives to the point where the de regulation and the relaxation of rules just makes this whole thing not worthwhile and in this regard they have been most successful.



They have completely removed the incentive of any tax revenue and do gas fired megawatt generators need the same regulation as the ding dong cooking lamb chops on a gasser at 3 am while drunkenly singing Cold Chisel? I am pretty sure different rules will apply


Probably deluded, maybe naive but respectfully


FatManDancing


*edit, redundant sentence and clarification*

[BSC_Kilby]

I don't know that you're deluded Fat Man, maybe just a bit too optimistic. The craft industry has no incentive to have home-level operators any more than the big guys do. The industry put forward an argument that these changes would increase tax revenue to the gov, so don't think that this is motivated by not wanting the exicse revenue. The other thing is that the regulations aren't exclusively for tax income, it's also that they can sell the image of being pro-health and well being by limiting the amount of higher abv products that people have access to by increasing the price of them, which is an extremely popular stance in the wider community and results in votes.

[bluc]

Although the stance of "health" or "think of the children" is promoted and pushed by governement. I doubt big companies spend millions lobbying governements so we can be safe and healthy, especially the companies making the same products as us.

Most likely its in their best interest financially to do so...

[Sam.]

Although the stance of "health" or "think of the children" is promoted and pushed by governement. I doubt big companies spend millions lobbying governements so we can be safe and healthy, especially the companies making the same products as us.

Most likely its in their best interest financially to do so...

I think you will find their are ones spending a lot of money lobbying about alcohol "health" and "think of the children" but in the negative way for alcohol producers.

Remember when tobacco companies could advertise freely and sponsor major sports? Alcohol will be next on the chopping block if some groups have their way.....

[bluc]

:text-+1:

[BSC_Kilby]

Although the stance of "health" or "think of the children" is promoted and pushed by governement. I doubt big companies spend millions lobbying governements so we can be safe and healthy, especially the companies making the same products as us.

I guess I'm not making it clear here. It's not the big guys lobbying against home level. It's not the small guys lobbying against home level (but if they had to point to someone that was causing harm it would be easier to find cases of cowboys making nasty stuff at home than it would be to find cases against the big guys). The health lobby groups (guys like the cancer council for example) actively lobby against booze production at any level and argue that increases in taxation and harsher penalties for illegal production are ideal. They'd also love to increase age limits, apply plain packaging, and have more prominent warning labels (things like graphic images of miscarried babies). So not pushed BY government, pushed TO government. Home-level production almost never gets talked about in policy places in a positive manner, regardless of how safe it is when you know what you're doing. There's not a single entity apart from maybe the local HBS or specialist provider of parts and equip who have a vested interest in promoting home production and I am unaware of any of them going into bat with local politicians to overturn laws around producing at home. And honestly, why would they when they can still sell their gear without a single rule being changed as long as customers don't mess it all up by drawing attention to themselves? The thing the big guys do lobby against is any kind of further regulation, like the ones I've described above.

Make no mistake the government is aware that to the layperson, it's very popular to punish home producers, which has nothing to do with excise taxes.

Most likely its in their best interest financially to do so...

To this point. The recent changes to excise rebates came about because a number of industry bodies got together and paid to have detailed reports put together showing across 3 proposed changes, the gov would receive a bump in tax coming back to them. That has zero to do with the legality of home production.