Through ongoing government outreach efforts in Ottawa in partnership with the Canadian Coalition of Independent Craft Brewers (CCICB), paired with foundation-building strategic meetings, significant progress has been made in advancing excise tax modernization for the country’s beer sector. The focal point? A compelling proposal developed by MNP for a 50% reduction in excise rates for Canada’s smaller independent breweries with an annual output of up to 500,000 HL. The proposal will be revenue-neutral to government within three years.
So, what does this reduction mean in practical terms? Let’s break it down. A brewery producing 500 HL annually would save almost $900 yearly. Meanwhile, a 2,000 HL brewery would see savings surpassing $3,500, and a 5,000 HL brewery could pocket over $14,000 per year.
This proposal has found a receptive audience among various government offices and senior policy influencers. Recent meetings in Ottawa were positive and there is a growing awareness among MPs that modernizing the excise tax schedule should be a priority. We have strong advocates championing our cause in Ottawa, actively escalating the issue in the Department of Finance.
L to R: Craig Jangula (GR Consultant), MP James Maloney (Etobicoke—Lakeshore), Don Gordon (Parallel 49 Brewing Company), MP Rachel Bendayan (Parliamentary Secretary to the Deputy Prime Minister and Minister of Finance), Scott Simmons (President Ontario Craft Brewers), and Craig Prentice (Muskoka Brewing and Vancouver Island Brewing).
What’s particularly encouraging is the growing awareness and recognition that the excise tax structure is overdue for modernization (it has not been adjusted since 2006). Unlike last year, Finance Canada is taking a deep dive into this much needed reform by undertaking additional analysis. Plus, their validation of the quality of the MNP report further bolsters our proposal.
Looking ahead, we will capitalize on our established relationships and amplified influence as we navigate towards the 2024 budget deliberations. We understand the time investment required, but remain steadfast in our belief that sustained engagement will yield results.
While pushing for excise reform, we are equally vocal about our opposition to Bill S-254, which proposes warning labels on alcoholic beverages, including beer. Should further discussions arise, we’re poised to appear as official senate witnesses in the spring of 2024.
Closely related, Canada’s new Health Minister’s current priorities have taken focus away from addressing the Canadian Centre on Substance Use and Addiction’s (CCSA) proposed two-drinks-per-week low risk drinking guideline recommendation. Even though Health Canada has not come out to clarify to Canadians and policy makers that the proposed guidelines have not been updated as we requested, they continue to use the guidelines from 2011 which is a good sign. We will continue to monitor progress and rally behind fact-based efforts to educate Canadians like those of the Canadian Association for Responsible Drinkers (CARD).
On the environmental front, the lobbying efforts of the Responsible Plastic Use Coalition were successful in overturning Ottawa’s single-use plastic ban, including plastic 6-pack rings. This gives breweries who have not yet conformed a temporary reprieve. Public sentiment and local jurisdictions, however, are still favoring eco-friendly packaging, urging breweries to explore cleaner, greener alternatives.
December 1st marked my one-year anniversary as the Executive Director of CCBA, causing me to pause and I reflect on the journey in federal advocacy. While time flies, policy changes take time, a lot of time. With 2024 looming as a challenging year—CEBA loans coming due, high interest rates, inflationary pressures, and people generally drinking less—I remain committed to working with the CCBA and other key strategic partners to advocate on behalf of Canadian craft brewers, doing all we can to ensure the long-term sustainability and growth of our vital, community-building industry.
Executive Director, Canadian Craft Brewers Association