Fuel and alcohol excise rates changed again in August 2026, creating different outcomes for motorists, businesses and drinkers.

Fuel excise returned to its full indexed rate on 3 August 2026 after several months of temporary relief, while excise on packaged beer and spirits also increased through the regular indexation process.

Draught beer was the notable exception. Its excise rates remain frozen under a two-year arrangement that runs until August 2027.

Fuel Excise Returned to 53.7 Cents a Litre

Temporary fuel excise relief began on 1 April 2026.

From 1 April to 30 June, excise on petrol and diesel was reduced from 52.6 cents per litre to 20.6 cents per litre.

That represented a reduction of 32 cents per litre during the first stage of the relief period.

From 1 July to 2 August, the rate increased to 36.6 cents per litre.

The temporary relief then ended.

From 3 August 2026, the excise rate on petrol and diesel increased to 53.7 cents per litre.

That amount reflects both the restoration of the full rate and the August 2026 indexation adjustment.

How the August Indexation Worked

Fuel excise is generally indexed twice each year, in February and August.

For August 2026, an indexation factor of 1.020 applied.

The factor reflected movements in the consumer price index between the relevant December 2025 and June 2026 quarters.

Applying the indexation adjustment to the pre-relief fuel excise rate resulted in the new rate of 53.7 cents per litre.

This means the August increase was not simply the end of temporary relief. It also incorporated the scheduled CPI-based adjustment.

A Hypothetical 60-Litre Fuel Example

Consider a driver filling a 60-litre tank.

At the April-to-June rate of 20.6 cents per litre, the excise component would have been:

60 × $0.206 = $12.36.

At the July rate of 36.6 cents per litre, the excise component would have been:

60 × $0.366 = $21.96.

At the 53.7 cents-per-litre rate applying from 3 August, the excise component is:

60 × $0.537 = $32.22.

That is $19.86 more excise per 60-litre tank compared with the deepest relief period.

GST is generally applied to the excise-inclusive price, so the total tax difference at the bowser can be slightly larger.

Actual retail fuel prices can still move differently because wholesale oil prices, exchange rates, transport costs and retail margins also affect the final price.

Fuel Tax Credits Also Changed

The end of temporary fuel excise relief also affected fuel tax credit calculations.

Eligible businesses generally calculate fuel tax credits using the applicable rate in force when the fuel is acquired.

This can create additional record-keeping requirements where an activity statement period covers more than one excise rate.

For example, a business buying fuel both before and after 3 August may need to separate those acquisitions when calculating its claim.

Heavy vehicle operators can also be affected by changes in the road user charge, which interacts with fuel tax credit entitlements.

Accurate acquisition dates therefore remain important.

Packaged Alcohol Rates Rose on 3 August

Alcohol excise rates were also indexed on 3 August 2026.

The same 1.020 CPI factor increased rates applying to several packaged alcohol categories.

Full-strength packaged beer increased from $63.75 to $65.03 per litre of alcohol.

Low-strength packaged beer increased from $54.74 to $55.83 per litre of alcohol.

Brandy increased from $100.85 to $102.87 per litre of alcohol.

Other spirits and excisable beverages above 10% alcohol increased from $107.99 to $110.15 per litre of alcohol.

What the Increase Means for a Can of Beer

Beer excise is calculated by reference to the litres of alcohol contained in the product, subject to the applicable rules.

Consider a hypothetical 375ml can of beer containing 4.5% alcohol.

The excise component before the August increase was about 80 cents.

After the indexed rate increase, it rises to about 82 cents.

The change per individual can is relatively small.

However, the cumulative effect becomes more noticeable across cartons, wholesale volumes and larger production runs.

Retail prices do not necessarily move by exactly the same amount because GST, production costs and business margins also affect shelf prices.

What the Increase Means for Spirits

Consider a hypothetical 700ml bottle of spirits with an alcohol content of 40%.

That bottle contains 0.28 litres of alcohol.

At the earlier rate, the excise component was approximately $30.24.

At the new rate, it rises to approximately $30.84.

That is an increase of about 60 cents in excise per bottle before considering GST and any other pricing changes.

Again, the final retail price may differ depending on how businesses absorb or pass through the additional cost.

Why Draught Beer Was Different

Draught beer rates remain frozen under a two-year arrangement that began in August 2025.

Indexation is scheduled to resume in August 2027.

The freeze applies across relevant draught beer excise categories.

For full-strength draught beer in qualifying kegs above 48 litres, the excise rate remains $43.39 per litre of alcohol.

Mid-strength draught beer remains at $33.11 per litre of alcohol.

Low-strength draught beer remains at $10.57 per litre of alcohol.

Because packaged beer continues to be indexed while draught beer does not, the gap between the two excise rates can widen during the freeze period.

A Hypothetical Pub Pint Example

Consider a 570ml serving of beer at 4.5% alcohol.

At the current frozen full-strength draught rate, the excise component is approximately 83 cents.

If the August 2026 indexation factor had applied to draught beer, the rate would have increased and the excise component would have been slightly higher.

The difference per serving would be small, but across large volumes it becomes more meaningful for pubs, breweries and hospitality operators.

The freeze does not guarantee that pub prices remain unchanged because venues still face other operating and input costs.

Packaged and Draught Beer Are Now Further Apart

The continuing freeze means full-strength draught beer remains at $43.39 per litre of alcohol while full-strength packaged beer has risen to $65.03.

This creates an increasingly large gap between the excise treatment of packaged and draught products.

The difference reflects the separate policy treatment rather than a change in alcohol strength or tax structure.

If indexation resumes as scheduled in August 2027, draught beer rates will begin moving again under the ordinary indexation framework.

Tobacco Uses a Different Indexation Schedule

Tobacco excise is indexed separately from fuel and alcohol.

From 1 September 2026, the tobacco excise rate for qualifying cigarettes increased following its scheduled adjustment.

Tobacco rates are generally indexed in March and September rather than February and August.

The indexation mechanism also differs because tobacco rates are linked to movements in average weekly ordinary time earnings rather than CPI.

This is why tobacco rate changes occur on a different timetable from fuel and alcohol excise.

What Businesses Need to Track

The August changes affect several areas of business administration.

Fuel users may need to separate acquisitions across different fuel tax credit rates.

Alcohol producers and distributors need to apply the correct excise rates from the relevant effective date.

Businesses selling packaged alcohol may also need to account for higher excise costs in inventory and pricing systems.

Hospitality businesses selling draught beer remain under the frozen excise rates until the freeze ends.

Keeping rate changes aligned with the correct acquisition, production and reporting periods is important for accurate tax calculations.

Key Dates to Watch

The next regular indexation round for fuel and most alcohol products is expected in early February 2027.

Draught beer is scheduled to remain frozen until August 2027, when indexation is due to resume.

Tobacco's next scheduled adjustment is due in March 2027.

For businesses, these dates matter for excise liabilities, fuel tax credit calculations, accounting systems and pricing.

For households, the most significant change in August 2026 was the return of fuel excise to its full indexed rate.