If you’ve been following the news out of Ottawa and the rest of Canada this year, you’ve probably heard the phrase “interprovincial trade” more times than you can count. At first glance, opening interprovincial trade for alcohol sounds like an obvious win for craft breweries; encouraging Canadians to buy products made by Canadians aligns perfectly with today’s growing “buy Canadian” movement. That urgency has only grown. On July 21, the United States announced 50 per cent tariffs on a range of Canadian goods, including craft beer, set to take effect August 19, 2026. It is a stark reminder that supporting Canadian owned and made products has never mattered more. However, while we do support that vision, the details matter to ensure successful implementation. Accordingly, we welcomed the opportunity to contribute to the conversation during a recent meeting with the Office of Minister Dominic LeBlanc, the Minister of Internal Trade. The Minister is also the President of the King’s Privy Council for Canada and the Minister responsible for Canada-U.S. Trade, Intergovernmental Affairs, Internal Trade and One Canadian Economy.
The Context
Late last year, the Canadian Mutual Recognition Agreement (CMRA) came into effect, which was a big step forward for trade between provinces. However, alcohol, (along with food and labour mobility) were not included in this agreement, leaving the conversation of interprovincial alcohol trade to the individual provinces and territories. Most provinces and territories have committed to removing barriers to direct-to-consumer (DTC) alcohol sales across provincial lines while other provinces have stalled. In this changing environment, questions remain, most notably around potential impacts to the craft beer industry.
Why Craft Beer is Different
Compared to many other alcoholic beverages, beer is heavy, bulky, and perishable. Shipping it long distances is expensive and impractical, which is why breweries have traditionally been built close to the communities they serve. For most craft beer drinkers, “buying local” doesn’t mean buying Canadian beer, it means supporting the brewery from their own city or region that employs neighbours, sponsors community events, and serves as a gathering place in town.
That’s why direct-to-consumer interprovincial shipping isn’t likely to become a major sales channel for most craft breweries. However, it can create new opportunities for some breweries, strengthen the broader Canadian marketplace, and make it easier for consumers to discover great independent beer from across the country.
With craft beer still sitting at only about 17% of the national beer market share, there’s real room for the industry to grow from interprovincial trade, if the foundation underneath it is solid and fair.
Building a Framework for Interprovincial Alcohol Trade
As governments consider new approaches to interprovincial alcohol trade, we want a level playing field with no unintended advantages for one beverage category over another.
We believe several principles are essential:
- Destination-based taxes, liquor board markups and container deposits should continue to apply.
- Provinces need practical licensing, auditing and enforcement mechanisms.
- Minimum pricing and reasonable personal-use volume limits should remain in place.
- Any new framework should recognize the unique realities of beer distribution and logistics.
- Introduction of modern taxation frameworks in every province and territory that promotes the growth of the national craft brewing sector.
- Modernize current wholesale markup systems across all provinces, removing red tape processes with easy-to-follow registration systems.
- Barrier-free, market access for craft brewers in every province and territory.
- Establish straight-forward recycling and environmental can levy systems that treat canned beer similar to other canned beverages.
- Warehousing and distribution access should be consistent within each province and should be available to all manufacturers entering the market.
Supporting a Maturing Industry
Canada’s independent brewing sector has grown remarkably over the past two decades. Today, nearly 1,200 craft breweries operate in communities across every province and territory. Independent craft breweries support approximately 30,000 jobs across Canada, including roughly 8,800 tourism-related positions. They create local gathering places, attract visitors, support artists and musicians, and contribute to vibrant downtowns and rural communities. We also support spin-off industries such as agriculture and manufacturing. As our industry matures, some consolidation is natural with breweries closing as well as opening. Breweries are also facing significant cost pressures like ingredients, packaging, rent, labour, and transportation that make thoughtful public policy more important than ever, especially since input costs for craft brewers run roughly three times higher than what large, foreign-owned multinationals pay.
Our Top Federal Priority Remains Excise Modernization
While interprovincial trade is an important discussion, we believe excise tax reform will have a much bigger impact.
The federal government’s temporary 50% reduction in excise duty on the first 15,000 hectolitres brewed demonstrated that Ottawa recognizes the unique challenges facing smaller producers. It has provided meaningful relief for independent breweries but is just a band-aid on the permanent problem.
Our top federal advocacy priority is for permanent, structural modernization of the Excise Act, including extending meaningful relief on the first 500,000 hectolitres brewed. In addition, we need better access to sales and market data and continued red tape reduction so our sector can plan and grow with real information in hand.
On interprovincial trade, we are asking government to bring alcohol into the CMRA negotiations and include guardrails that keep the policy fair for the alcohol industry. We are also advocating that small, Canadian-owned producers shouldn’t be crowded out by multinationals with a fraction of our cost base. Every craft brewery is a local employer, often a tourism draw, and in a lot of towns, the only real gathering place for the community and a stage for local artists.
We will continue working with governments, provincial partners and our members to ensure the voice of Canada’s independent breweries is heard. As always, thank you for the work you do in your own communities. It’s what makes these conversations in Ottawa worth having.
Christine Comeau
Executive Director
Canadian Craft Brewers Association