Excise Tax on Alcohol Have I Got My Math Right

jizmo on 30/12/2021 - 17:48
Last edited 30/12/2021 - 20:47 by 1 other user

Just looking https://www.ato.gov.au/business/excise-on-alcohol/lodging,-p…
If I buy a carton of beer at 5% would be 24 x .330 7.92 L x $52.49 x 0.05 =$20.78 ++item and GST
or in Table 2 7.92L x $88.91 x 0.05 = $35.20 ++

Bought carton of Peroni the other day on special for $40 and I can't see how anyone makes money.

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  trex on 30/12/2021 - 18:21

  +2

  https://www.ato.gov.au/business/excise-on-alcohol/lodging,-p…

  Beer – formula for excise duty

  For beer, excise duty is worked out on the alcoholic content above 1.15%:

  Total volume (litres) of product × (alcohol strength – 1.15%) × current excise duty rate

  So calculations should be:-

  24 cans x 0.330L x (5% - 1.15%) = 0.30492 total litres of alcohol (LAL) truncated to one decimal 0.3 LAL. So 0.3 LAL x 52.49 = $15.75

  *Table 2 : 88.91 is for spirits and other excisable beverages (not including beer)

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  JIMB0 on 30/12/2021 - 18:44

  +1

  The cost of production is quite low. Look at wine, you can buy a 4L cask of 9.5% (30 standard drinks) for under $10 as it has little tax on it.

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    jizmo on 30/12/2021 - 19:35

    Yeah but if you look at Trex's calculations you have $15.75 plus near $4 GST. That leaves $20 to make it. Ship it from Italy(not sure if made under license here in Australia) Transport it and then someone to Refrigerate and sell it.
    That's crazy and yet these companies still make a fortune

    • 

      trex on 30/12/2021 - 20:08

      GST is not a cost to a business if they are GST registered. GST on purchases is net off against GST on sales, net amount is paid (if GST on sales is more) to ATO or recovered (if GST on purchases is more) from ATO.

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      trongy on 30/12/2021 - 23:28

      The main ingredient is barley which is incredibly cheap - far cheaper than the cost of the sugar in a slab of Coke. My rough estimate is that your slab of Peroni would contain about 50c worth of barley at wholesale prices.

      The process of brewing beer is more complicated than mixing a soft drink, but the factories of major brewers are highly automated.