Australia markets open in 6 hours 35 minutes
  • ALL ORDS

    7,325.20
    +19.20 (+0.26%)
     
  • AUD/USD

    0.7847
    +0.0061 (+0.79%)
     
  • ASX 200

    7,080.80
    +19.10 (+0.27%)
     
  • OIL

    64.82
    +0.11 (+0.17%)
     
  • GOLD

    1,832.00
    +16.30 (+0.90%)
     
  • BTC-AUD

    73,250.00
    -2,268.61 (-3.00%)
     
  • CMC Crypto 200

    1,480.07
    +44.29 (+3.08%)
     

$250,000: Major tax cuts announced

Eliza Bavin
·2-min read
Frydenberg announces tax cuts in upcoming Budget
Treasurer Josh Frydenberg has announced tax cuts in upcoming Budget (Source: AAP)

Treasurer Josh Frydenberg has announced tax breaks for distillers and breweries that could see savings of up to $250,000 a year.

The changes will be set out in this month’s budget and will triple the amount of alcohol producers can sell before excise tax applies.

Currently, brewers and distillers can claim 60 per cent of paid excise up $100,000 a year, but under the changes this will be increased to up to $350,000 a year.

The Australian Taxation Office (ATO) explains that businesses which hold an excise licence need to lodge an excise return and pay an excise duty before releasing their product into shops.

This means liquor producers are required to pay taxes upfront on alcohol and can claim some of the costs at tax time.

Increasing the amount they can claim on will allow producers an extra $250,000 of tax breaks every year.

“Today’s announcement is great news for smaller brewers and distillers right around the country, from capital cities to regional towns,” Frydenberg said.

“Australian brewers and distillers are world leaders in their field and this measure is going to assist them to continue to invest, grow and create jobs.”

Many Australian breweries and liquor producers were hit hard by the COVID lockdowns which saw them having to dispose of huge amounts of product as pubs and businesses closed.

The tax breaks will be welcomed, particularly in regional areas which account for two thirds of Australia’s brewers and distillers.

The Treasurer has spoken openly in the lead up to the Budget about the Governments focus on tax cuts.

At the Chamber of Commerce yesterday Frydenberg said the Government is committed to boosting productivity to help Australia’s economic recovery.

“The Government will continue to pursue a range of reforms and investments to boost productivity and set Australia up for the future,” he said.

“This includes measures to be outlined in this year’s Budget in the areas of skills, infrastructure, tax, energy, digital technology and deregulation to name just a few.”

Follow Yahoo Finance on Facebook, LinkedIn, Instagram and Twitter, and subscribe to the free Fully Briefed daily newsletter.