Warrnambool pub prepares for prices to increase

A 2.2 per cent "beer tax" hike came into effect August 1, meaning south-west publicans will pay about $80 in tax for a full-strength keg.

Warrnambool's The Cally Hotel co-owner Lucas Reid said he expected the higher tax would have a flow-on effect with customers paying more at the tap.

He said while The Cally was yet to rise its prices, it was only a matter of time as it, like everyone else, faced increased operating costs.

Mr Reid said as a result of the increased beer tax, patrons may opt to reduce their number of weekly visits or consume less drinks.

Under the new margins, it is expected the price of a pint will rise by about $1.

Mr Reid said the beer tax rose annually in August but people were more accepting "this time around" as price hikes were more commonly felt across businesses and households this year.

He said The Cally was also facing rising electricity and insurance costs.

"People go to the grocery store and say 'that's more expensive, that's more expensive'," he said.

"Everything is more expensive.

"It's not something new and it's not something we want given the other pressures that people are under with other expenses.

"People have an understanding at the moment that hotel costs have increased, products have increased and prices increase.

"Now they go 'it is what it is. I'll have one less beer or I'll come three times a week instead of four times'.

"We'd love not to pass on the additional cost but there's a 5.75 per cent increase in wages from July 1 and there's an increase to the award tax.

"In order to have a viable business we have to increase the prices in line with the CPI increases."

He said the rising cost of living was a topic at an Australian Hotels Association industry event called Pubs, Pots and Profits, held in Warrnambool on Wednesday.

"They're saying people are still spending at pubs," Mr Reid said.

"The data showed where patrons might have been going three times a fortnight, they're only going twice a fortnight. So people aren't spending any less when they go, but they're probably not going as often.

"Unfortunately the people who need the social interaction, who go to the hotel regularly are the ones who will be most affected."

IN OTHER NEWS

Our journalists work hard to provide local, up-to-date news to the community. This is how you can access our trusted content: