Wednesday,
15th May 2002
CONSUMERS WIN AS BUDGET ENHANCES INTEGRITY IN ALCOHOL LABELLING
‘Consumers
are the big beneficiaries of the announcement in the Federal Budget
that closes the excise loophole whereby alcohol products manufactured
at less than their labelled alcohol strength gained a tax advantage
over other products and short-changed consumers,’ said the Distilled
Spirits Industry Council of Australia (DSICA) today.
DSICA welcomed the Government’s announcement that
from 7:30pm last night, excise duty is now payable on the higher of
either the labelled or actual alcohol content for products manufactured
locally.
This has always been the case for imported alcohol products
under the Customs Act. However, a loophole
existed whereby Australian manufactured pre-mixed spirits or beer
were only required to pay excise on the actual alcohol strength, and
could therefore be falsely labelled as containing a higher strength
of alcohol with no penalty or recourse.
In effect, under this loophole, a can of pre-mixed spirits
or beer could have been labelled as 5% alcohol by volume (abv), but
only contain 4.8% alcohol or less. Not only would this have mislead
and short-changed consumers, but the falsely labelled 4.8% abv product
would have gained a significant tax and price advantage over legitimate
5% abv products.
Now, a 4.8% abv product falsely labelled as 5% abv must
pay excise on 5%, removing the incentive to short-change consumers.
‘This is great news for the spirit industry, and
pre-mixed spirit drinkers,’ said Mr Gordon Broderick, Executive
Director of DSICA.
‘While DSICA Members already pay excise on the labelled
strength, and continually strive to manufacture as accurately as possible
to that labelled strength, the industry has been very concerned about
the potential for someone to exploit this loophole, create an unlevel
playing field, mislead consumers and harm the industry’s good
reputation.
‘By closing this loophole, the Government has ensured
the ongoing integrity of the alcohol industry’s products and
labelling practices, and reassured consumers that they are getting
exactly what they pay for.
‘The Government is to be congratulated for taking
such prompt and decisive action, protecting the interests of both
the industry and consumers,’ said Mr Broderick.
