Brewers ask government to stop raising taxes

As many Canadian beer makers are pivoting to produce supplies and support Canada’s fight against COVID-19, they are now looking to government for relief.

The United States and Germany have allowed brewers to delay monthly excise duty payments, while the United Kingdom has paused planned excise duty increases.

Canada’s federal government can do the same to help out Canadian brewers and Canadian beer drinkers. We are asking the government to postpone monthly excise duty payments and to roll back the automatic excise duty increase that went into effect April 1, which not only takes precious cashflow from brewers’ hands, but also makes beer more expensive, once other federal and provincial taxes are layered in. It is just not reasonable during these challenging economic times to be raising taxes on Canadians.

Whether it’s the production of hand sanitizer for front-line workers, the donation of food to those who are most vulnerable, or supporting the restaurant and hospitality sector, there’s countless examples of how Canada’s beer industry has stepped up and contributed throughout this pandemic.

Many Canadian brewers are making these contributions as the future of their own businesses are uncertain. While there may have been a momentary uptick in beer sales in March, brewers now find themselves entering what are traditionally the busiest months of the year with patios shutdown, and the cancellation of concerts, sporting events and other social gatherings that typically drive beer sales.

For a regional or mid-sized brewery (think Steam Whistle or Muskoka Brewery), the April 1 increase amounts to another $40,000 to $50,000 in lost cashflow. That is on top of the estimated $150,000 a brewery of this size would already be remitting monthly to the federal government.

No other sector in Canada’s agrifood industry carries a tax that automatically increases annually despite the changes occurring in the industry’s operating environment. It is this fact that warrants government to implement sector-specific measures.

Just as government leaders are asking landlords to defer rent for tenants, brewers are simply asking government to implement these measures for the same reason — so they can afford to pay their bills, pay their employees, and be in a position to continue contributing to the economy when this is all over.

Brewers support a large supply chain, contributing to the livelihoods of farmers, glass bottle makers, aluminum can manufacturers, distributors, truck drivers, warehouse workers and countless others connected to the industry, as well as supporting tourism, hospitality and food service, and their employees.

Postponing the monthly payments of federal excise duty and rolling back the April 1st excise duty increase on beer are moves the government can make to provide room for brewing companies to maintain the cashflow needed to help keep their doors open, to pay staff and suppliers now, and their fair share of taxes in the future.