Excise Tax What?
Excise tax, also known as 'sin tax' in other parts of the world, is going up by 6.5% here in New Zealand on the 1st July. It's a hefty hike on top of last years hike (6.9%) and it doesn't make things pretty for people trying to sell their crafted alcoholic treats nor the people whom enjoy said treats.
So what exactly is excise tax?
To put it very basically; it's a tax put on alcohol producers that the government wants us to then put onto our customers so that it puts them off from buying our products (because they're too expensive). Neato. The tax varies depending on the alcohol percentage of the product, obviously the higher the alc % (it jumps up at <15% ABV) the more you pay. In actual fact though, NZ has one of the lowest excise tax rates, Finland I believe tops the charts.
Honestly, I am not against taxes; they're a necessary evil that keep the country maintained and running for all and I like to think help those less fortunate with our social/health/housing/educational services. And I know that alcohol causes problems in our communities, including on our roads and at our hospitals. There are many people on those front lines celebrating the excise tax increase.
But boy oh boy - it makes it hard for the boutique winemaker (and cider/mead/beer/spirit maker), especially when just starting out. Our prices tend to be on the higher side anyway out of necessity and as much as we'd like to absorb these extra costs, it's a tricky line to navigate. Oh! And post/courier fees are increasing by 6.4% on the 10th July. Cripes!
Dry July. Groan!
So; if you're doing dry July, forewarned is forearmed, when you come out of it you may find your favourite tipples will be a little bit more (but that's hardly surprising these days is it!). If it's going to hit you hard though, maybe consider stocking up before dry July... then maybe us producers won't have a destitute July!