TAXES & BEER, AUSSIES & WINE

TRADE GROUP FOR CANADIAN BEER INDUSTRY WANTS TO STOP ANNUAL TAX INCREASES; AUSTRALIA FILES A COMPLAINT OVER CANADA’S WINE SALES RULES.

The federal government’s plan to hike excise taxes on beer every year will result in consumers paying more for the alcoholic beverage and business owners investing l ess in their operations, says an industry association fighting the change.

The industry is already grappling with high taxes, said Beer Canada, a trade association for major brewers. These future increases, which will be tied to inflation, will only exacerbate the challenges it’s facing and possibly accelerate the slowing of beer consumption in Canada, the organization said Tuesday.

“Beer drinkers are going to be faced with higher prices because of higher taxes. That’s not favourable for sales,” said Luke Harford, the association’s president.

“Brewers are going to be left with less money to invest in their plants, their people and their communities — and that’s not a good thing either,” he added.

Beer Canada officially launched a campaign Monday asking suds- loving Canadians to sign a petition requesting that Finance Minister Bill Morneau axe the escalating beer tax. The petition, which the group started sharing several weeks ago via its social media channels, collected 15,400 signatures as of Tuesday morning, according to the association.

In l ast year’s f ederal budget the Liberal government increased the excise duty rates on alcohol products, including beer, by two per cent, Finance Minist er spokeswoman Chloe Luciani- Girouard said in an email. That amounts to about a nickel per 24- bottle case of beer, she said.

At the time, the government also announced it would annually adjust the tax by indexing it to the consumer price index with the first inflationary adjustment coming this April.

“It’s worth remembering that the last effective increase to the federal excise tax was over 30 years ago,” said Luciani- Girouard, adding small Canadian brewers are charged decreased rates on the first 7.5 million litres of beer.

But Beer Canada wonders how the 50 brewers it represents will manage these yearly tax bumps.

Between 2012 and 2016, per capita beer consumption decreased 7.55 per cent from 83.4 litres to 77.1 litres, according to the group.