Conservative MP Pat Kelly would like to amend both the excise duty bill and his latest model, the 2001 excise duty bill, to abolish automatic alcohol tax increases at the same rate of inflation. Kelly is calling for a return to pre-2018 levels when the escalator was introduced.
He said the rising tax on alcohol made “drinking a beer with friends” unbearable for most Canadians.
“It’s really expensive to go out for a simple dinner or enjoy a night out with friends,” he told CTVNews.ca in an interview.
“When we are in an inflation crisis, linking this tax to it is not going to help affordability or competitiveness for our producers.”
From 2017, the excise tax rates on beer, wine, spirits and other alcoholic beverages increase automatically every year on April 1st.
Kelly argues that, like other proposed tax changes, it should be reconsidered in Parliament whenever there is a drive to increase it.
“They took it from the hands of Parliament and just allowed it to go up automatically,” he said.
NDP lawmaker Richard Cannings, meanwhile, says the government should abolish the excise tax on low-alcohol beer – that is, beer with an alcohol content of less than 0.5 percent.
“This corrects a strange anomaly in the excise duty law, where low-alcohol wine, low-alcohol spirits are exempt from excise duty, but low-alcohol beer is not,” he said.
In terms of competitiveness, Cannings says this will put Canada in line with its key trading partners who have not applied the same tax to low-alcohol beer.
He also said he would give Canadians more choice in beverage choices as non-alcoholic beer consumption rates increase.
Cannings has a better chance of passing his private bill in Parliament, as he is higher on the list of priorities.
The NDP lawmaker said he had had preliminary talks with all three parties and believed there was a “good chance” the bill would go ahead either through the upcoming government budget bill or through a unanimous consensus proposal.
Beer Canada, which was present at the NDP press conference on Thursday, said in a statement to CTVNews.ca that this was the “wrong time” to add to the tax burden on Canadian breweries, pubs, restaurants and consumers.
“In Canada, 85 percent of the beer sold here is brewed here. “Like other agri-food companies, Canadian breweries are experiencing almost unprecedented inflation costs and supply chain disruptions,” said Luke Chapman, vice president of federal affairs.
“Beer Canada encourages members of all parties to support the abolition of the excise duty on non-alcoholic beer, as well as the automatic annual increases in federal beer taxes.”
