By Kate Davis C anada’s booming beer economy is facing a growing challenge and that is beer taxes. Beer Canada says that close to half of what consumers pay now for their favorite beer is tax and as the federal tax on beer increas- es annually starting next April, consumers will have to pay even more for a cold one. The federal tax on domestic and imported beer increased two percent last year as part of the 2017 Federal Budget and it will continue to increase every year in line with infla- tion starting April of this year, which means it will cost you more to get your beer buzz come Spring.
“The federal tax on beer right now is $31.84 per hectoli-
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tre, and it will increase to $32.32 per hectolitre, and this will drive up liquor board markups, PST and GST,” said Beer Canada spokesperson Brittany Moorcroft. The scheduled 2018 & ”escalator” tax amounts to a 1.51 percent increase. Beer Canada, which represents the brewers that account for 90 per cent of the beer made in Canada, has launched a campaign calling on Finance Minister Bill Morneau to scrap the tax increase as Canada has some of the highest beer taxes in the world. The Fed’s cannot help but notice that the beer industry contributed $13.6 billion to Canada’s economy and gener- ated $5.7 billion in tax and other revenues in 2016 so, an additional 3.51 percent or $200 million in tax revenue will help with some of the excessive spending that has been going on in Ottawa these days, but at what cost. Higher beer prices make it harder for brewers to sell beer, which means brewers invest less in their people, plants and community. That is not a good thing, considering the beer industry supports nearly 149,000 jobs in Canada. Less sales mean less revenue which can lead to industry layoffs and these layoffs will cause the labour income of about $5.3 billion generated by the industry to drop.
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So, you might want to think about your beer the next time you are heading to the polls.
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