Nicola Roxon (Gellibrand, Australian Labor Party, Minister for Health and Ageing) Share this | Hansard source

I present a supplementary explanatory memorandum to this bill and to the Customs Tariff Amendment (2009 Measures No. 1) Bill 2009 and seek leave of the House to move government amendments (1) to (4), as circulated, together.

Leave granted.

I move government amendments (1) to (4):

(1)    Clause 2, page 1 (lines 7 and 8), omit the clause, substitute:

2 Commencement

        (1)    Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.

Note:   This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent.

        (2)    Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act.

(2)    Schedule 1, heading, page 3 (line 2), omit “Excise Tariff Act 1921”, substitute “Ready-to-drink beverages”.

(3)    Schedule 1, page 3 (before line 4), before item 1, insert:

Excise Tariff Act 1921

(4)    Page 3 (after line 8), at the end of the Bill, add:

Schedule 2—Beer

Excise Tariff Act 1921

1 Schedule (definition of Beer)

Repeal the definition, substitute:

beer means a brewed beverage that:

             (a)    is the product of the yeast fermentation of an aqueous extract, being predominantly an aqueous extract of cereals:

                   (i)    whether the cereals are malted or unmalted; and

                  (ii)    whether or not the aqueous extract contains other sources of carbohydrates; and

             (b)    contains:

                   (i)    hops, or extracts of hops, such that the beverage has international bitterness units of not less than 4.0; or

                  (ii)    other bitters such that the beverage has a bitterness comparable to that of a beverage mentioned in subparagraph (i); and

             (c)    contains not more than 4.0% by weight of sugars; and

             (d)    has not had added to it, at any time, artificial sweetener; and

             (e)    may have had added to it, at any time, other substances, including flavours, but only if, in the case of substances that contain alcohol (other than spirit distilled from beer), the alcohol did not add more than 0.5% to the total volume of the final beverage; and

              (f)    may have had added to it, at any time, spirit distilled from beer, but only if that spirit did not add more than 0.5% to the total volume of the final beverage; and

             (g)    contains more than 1.15% by volume of alcohol.

2 Schedule (the definitions)

Insert:

sugar means:

             (a)    monosaccharide; or

             (b)    disaccharide.

3 Application

The amendments of the Excise Tariff Act 1921 made by this Schedule apply in relation to beverages manufactured or produced on or after the commencement of this item.

These supplementary amendments to the Excise Tariff Amendment (2009 Measures No. 1) Bill 2009 alter the definition of ‘beer’ for taxation purposes. The amendments are aimed at ensuring that beer products that attempt to mimic spirit based products in relation to their taste are taxed as a spirit based product—that is, at the higher tax rate.

The need for moving these amendments is a sign of how desperate the industry has become to target sugary, colourful drinks at teenagers, which is simply unacceptable. Today we are introducing these amendments to crack down on these ruthless alcopops producers. The tax office has already decided that some products, known as ‘malternatives’, will be treated as alcopops. A recently released tax office interpretive decision clarified that to meet the current definition of ‘beer’ a beverage must have sufficient quantities of hops or extracts or other bitters to satisfy the bitterness requirement. These amendments will formalise this for all ‘malternatives’ and prevent the development of new beer and wine based products that are simply trying to get around the law.

These changes will go further and, by being forward looking, seek to prevent the development of new beer based products that attempt to overcome the current definition. These amendments will achieve this goal by changing the definition of ‘beer’ to set a combination of minimum limits on bitterness and maximum limits on sugar content that must be present in the final beverage. As part of the sugar requirement, artificial sweeteners will not be permitted to be added to beer. The proposed revised definition of ‘beer’ is sufficiently robust to allow innovation in the beer-making process by allowing additional ingredients, including small amounts of alcohol from a non-beer source, to be added during the brewing process. Such changes are expected to allow domestic brewers to better compete with international brewers by providing opportunities to produce new beer flavours within the new requirements concerning bitterness and sugar content.

These amendments have been designed to ensure that conventional beer products are treated as beer for tax purposes. Complementary changes will be made to the Customs Tariff Act 1995 so that imported beer is subject to the same definition of ‘beer’ for taxation purposes. Additionally, these amendments are part of a package of measures that also include changes to the ‘wine’ definition so that wine based products that attempt to mimic spirit based products in taste are taxed at a higher rate. These changes to the definition of ‘wine’ will be made in amendments to the A New Tax System (Wine Equalisation Tax) Regulations 2000 and the Customs Tariff Act 1995.

In the same way that we are dealing with beer based products, we will ensure that wine based products that attempt to mimic spirit based products in taste are taxed at the higher rate that applies to RTDs. These amendments are designed not to have any significant impact on conventional wine products. While only a very few wine products may be affected, the industry supports these changes.

No-one seriously disputes that alcopops are targeted at young people, who often have limited experience of alcohol and who may not recognise the effect alcohol is having on them, as its taste is disguised. We are serious about the binge-drinking crisis and we believe it is important for us to protect young people from the seemingly endless ingenuity of distillers, who will try to market their product to young people and get around each and every change that is made to the tax system.

We are determined that we will develop a multipronged strategy. Our binge-drinking strategy is already part of that. Our COAG preventive health initiative is another important part of it. Experts ranging from health professionals to police agree that binge drinking is a problem, and this measure is part of our overall comprehensive strategy to deal with this problem. If the opposition is seriously interested in helping address the binge-drinking problem, it should put its interest in this bill and support it ahead of its loyalty to distillers. That would be putting the health of our young people first.

Full details of the amendments are contained in the supplementary explanatory memorandum. It might assist the House to know that, although the government consulted with domestic brewers and winemakers to ensure that these new definitions had no unintended consequences, as a result of a briefing that my office and the Treasurer’s office provided to the shadow minister, I understand that a request has been made that we also seek the views of importers, which we are happy to do. If any unintended consequences are brought to our attention, we will make any further amendments to the legislation that are necessary. I understand that will assist the passage of these amendments through the House and I thank the shadow minister for that constructive contribution. (Time expired)

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