The government says the popular yeast-based product is contributing to anti-social behavior in some remote communities.
Indigenous Affairs Minister Nigel Scullion described the salty spread as a “precursor to misery”.
Nigel Scullion said Vegemite was being bought in bulk to make moonshine, sometimes being brewed in bathtubs.
In communities where alcohol is banned because of addiction problems, Nigel Scullion said Vegemite sales should also be restricted.
The minister added that in some cases children were failing to turn up to school because they were too hung over, and that Vegemite was an increasingly common factor in domestic violence cases.
Vegemite, which is something of an Australian culinary icon, started as a wartime substitute for Marmite.
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