Brewers say another tax increase harms pandemic recovery

Canadian brewers say a federal government tax hike on beer is the fifth in four years and it will hurt not only everyone in their industry but also bars and restaurants already suffering due to pandemic restrictions. 

Beer Canada represents 90 per cent of the country’s brewers. It says the sale of beer supports 149,000 jobs, generates $14 billion in GDP and $4.7 billion in government tax revenues. It also says Canada has one of the highest beer taxes in the world and they make up almost half of the price of the product.

Beer Canada is calling on the government to roll back a tax increase that is automatically imposed on beer each April 1 without a new vote in Parliament. It notes that this is the second increase during the COVID-19 pandemic. 

Brewers say that the sale of beer supports 149,000 jobs in Canada. (iStock)

Tax hike will cost $20 million, say brewers

“Continuing to raise taxes on beer in the middle of the pandemic is counterproductive to the government’s goal of supporting the recovery of Canada’s hardest-hit businesses, including restaurants and bars,” said Luke Chapman, Interim President of Beer Canada.

Brewers say the tax increase on April 1, 2021 will amount to another $20 million in taxes that Canadians and the struggling hospitality sector will ultimately have to pay. 

“Bars and restaurants, in particular, have been very hard hit, and they’re going to need the support of all their suppliers – including beer manufacturers,” said Andrew Oland, President & CEO of Moosehead Breweries. “Brewers across the country are finding ways to provide support and help our bar and restaurant partners, but we need the government to step up and create conditions that allow us to continue supporting the recovery. Raising beer taxes does the exact opposite.” 

Beer Canada has joined with partners in the hospitality, tourism and agriculture sectors to run a campaign to get the government to freeze beer tax increases. It notes that it has garnered more than 10,000 signatures in support of a freeze.