How the latest fad drink seltzer highlights Australia’s complicated alcohol tax system

For some, it tastes like “alcoholic lemonade”. For others, it’s “a light sour beer”.Likewise, for tax purposes, the latest fad drink being downed by Australian punters can be modified to taste. Seltzer is a huge trend in the United States, where brands like the popular White Claw are being made with distilled alcohol, fizzy water and some fruity flavouring. Since companies caught onto the trend 18 months ago in Australia, seltzer has been marketed to consumers as a healthier alcoholic option with low calories. It is now a major growth category for grocery giants such as Woolworths. While its origins are as a spirit-based drink, in Australia many craft brewers, and even the supermarket giant Aldi, are going through a complicated process to make seltzer as a beer.  Beer attracts a lower tax rate than spirits. The bizarre situation of having one drink made and taxed in different ways highlights the complicated and controversial intricacies of Australia’s alcohol excise code.

And some want seltzer “loopholes” closed.

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