Distillers hope federal budget scraps alcohol escalator tax

Tax hike set for April 1, marking third automatic increase in three years time

Distillers across Canada are calling on Finance Minister Bill Morneau to repeal a tax that has automatically increased the cost of alcohol for three years, with the next hike April 1.

Morneau was set to deliver his government’s final budget ahead of the October election on Tuesday. He has not indicated any plans to do so, but Spirits Canada hopes he will repeal the liquor escalator tax.

The tax, introduced in 2017, is automatically renewed each year without a vote, and sent spirit prices up 17 per cent last year, according to the organization that represents spirit distillers.

Eighty per cent of what people pay for beer, wine and spirits is already taxes, CEO Jan Westcott said in a news release Tuesday.

“Today’s escalator tax is having the same negative effect it had when Canada last experimented with it in the 1980s: sky high prices, a freeze on investment, closed distilleries, lost jobs and Canada losing ground versus our international competitors.”

READ MORE: Premiers join together to oppose federal carbon plan that hampers beer industry

READ MORE: B.C. wine industry disappointed over USMCA-related grocery store sales changes

The increase this April will amount to a few cents per litre, while wine will go up by one to two cents. Beer will climb four to 75 cents per 100 litres. Taxes are based on the percentage of alcohol.

The tax also affects tobacco, which will rise in cost one cent per five cigarettes and 60 cents per 1,000 cigars. Cannabis is also included, but that price will not go up in April.

According to Beer Canada, Canadian beer is taxed $20.31 per case on average, compared to $4.12 in the U.S.


@ashwadhwani
ashley.wadhwani@bpdigital.ca

Like us on Facebook and follow us on Twitter.

Just Posted

Nelson plans for Clearwater Creek as additional water source

Existing Selous and Anderson Creek sources to be upgraded

Two Nelson Police officers investigated for misconduct

The investigations were made public in an annual report

LETTER: Radical action needed on climate

From reader Brian Zacharias

Morrison wins Kootenay-Columbia for Conservative Party

Unofficial results peg 28,495 votes for Morrison with 98 per cent of polls reporting Monday evening

Raptors Bling: NBA champions receive their rings in pre-game ceremony

There are over 650 diamonds — at a weight of 14 carats — in the 14-karat yellow gold ring

Faster response may have prevented fatal outcome at B.C. trampoline park

Coroner’s report rules Greater Victoria father Jay Greenwood’s death accidental

100-pound pumpkin stolen a second time from B.C. business

According to security footage, a man and woman took the pumpkin on Oct. 20 at 8:20 p.m.

Greta Thunberg declines invitation to Victoria due to time, not ferry emissions

Thunberg confirmed that she will be joining a climate strike at the Vancouver Art Gallery on Friday

Feds decriminalizing drugs possible if Jagmeet Singh pushes for it, expert says

National pharmacare was one of Singh’s most highly-touted platform policies

‘Havoc and chaos:’ Alberta separatist group gains support as Liberals re-elected

The idea is getting interest from people in Saskatchewan, Manitoba and parts of British Columbia

In the news: Wexit, Brexit and Trump sparks outrage

There’s been a surge of support for an Alberta separatist group

Horvat’s hat trick lifts Canucks to 5-2 win over Red Wings

First career three-goal game for Vancouver captain

Most Read