Govt Cuts Red Tape to Let Restaurants Sell Take-Home Alcohol With Food Sales

Under the amendment, restaurants will be able to apply for an off-licence, provided they also prepare and sell takeaway food or non-alcoholic beverages.

The Government has announced a key reform to the Sale and Supply of Alcohol Act, removing restrictive rules that have long prevented restaurants with on-site retail spaces from selling take-home alcohol to their customers. Associate Justice Minister Nicole McKee says the change will support hospitality operators, encourage innovation, and give customers more choice.

Under the amendment, restaurants will be able to apply for an off-licence, provided they also prepare and sell takeaway food or non-alcoholic beverages. This aligns their rights with other responsible retailers and reflects the changing nature of hospitality businesses.

Fixing “Absurd” Barriers for Responsible Operators

Minister McKee said current rules unfairly penalise restaurants that produce and sell food items for customers to take home—such as sauces, pastries, condiments, or desserts—yet cannot sell a bottle of wine that a customer may want to take with them after dining.

“Right now, restaurants that prepare and sell food products like sauces, pastries or desserts for consumption off site are effectively barred from selling customers a bottle of wine to take home,” she said.“These rigid rules have created absurd barriers to responsible businesses providing a unique experience their customers want.”

Restaurants are already trusted to serve alcohol responsibly under their on-licence. The reform simply allows them to undergo the standard off-licence application process so they can sell alcohol for off-site consumption in a regulated, responsible manner.

Real-World Example: La Bella Italia

One of the best-known cases highlighting the flaw in current legislation is La Bella Italia in Petone, which has faced years of regulatory roadblocks. Despite offering a combined restaurant, café, and deli experience, they have been unable to sell customers a bottle of wine without navigating complex workarounds.

“Nonsensical rules like this help no one,” McKee said. “When the rules can’t adapt, they block good ideas and kill the spirit and ambition of the people behind them.”

Supporting Innovation in Hospitality

The Minister emphasised that New Zealand’s hospitality sector is constantly innovating, combining dining, retail, events, and artisanal food production. Regulations need to keep pace with these evolving business models.

“This red tape relief is about trusting responsible operators, giving customers more choice, and letting entrepreneurial hospitality businesses get on with what they do best.”

Acknowledging Years of Advocacy

Minister McKee also acknowledged the long-term advocacy that led to the reform.

• Chris Bishop, MP for Hutt South, first introduced the proposal as a Member’s Bill.

• Mike Butterick later advanced the Bill before it was adopted by McKee as part of the Government’s broader reforms to modernise alcohol regulation.

The amendment forms part of a wider effort to streamline outdated regulatory settings, reduce compliance burdens, and support business growth while maintaining responsible oversight of alcohol sales.