Sorry, but to explain this, we’ve gotta do a little bit of tax talk. In Australia, wine is taxed at a flat 29% of wholesale value (this is called the Wine Equalisation Tax); beer and spirit duties are calculated by alcohol content, and indexed to the Consumer Price Index (CPI), and adjusted when the CPI is updated in early February and early August every year, so it tends to follow the same patterns as inflation. So you’re not imagining it – your favourite tipples and tinnies have been rising in cost in the last few years along with your staple groceries.There’s some debate as to whether we’re the highest – some countries tax some products much more and others much less. But at the moment, a bit more than half of the retail price of a bottle of spirits is made up of the spirits excise.Yes, Australia has some high booze taxes compared to a lot of other similar countries, but tax isn’t the only cost that goes into pricing your pour – breweries, wineries, and distilleries are also on the hook for ingredients, equipment, maintenance, transport and shipping, paying and training skilled employees, marketing, and so on. And just like the lime and tonic water in your homemade G&T and the petrol you used driving to buy them, these things keep going up in price too (usually more so for small-scale local producers). So “duty-free” is just that: the retail price of the bottle or can, minus tax. If the costs of making your drink go up, so will the price companies have to charge for it, even before they get to factoring in the relevant alcohol duties.That said, while rising costs have affected producers all over the world, in many destinations you’ll find the same bottle for less in a regular shop – and even for less than at Australian duty free.
Is Australia’s alcohol tax the highest?