February 18, 2016

Alberta’s illegal beer tax was bad enough, but NDP made it worse

Holly NicholasRebel Commentator

The Alberta NDP protectionist tax on beer announced by Minister of Finance Joe Ceci on October 27th, 2015 is unconstitutional under Section 121 of the Constitution.

The new tax favours local breweries and significantly increases taxes on imports and craft beers produced outside of Alberta, Saskatchewan and British Columbia that are part of the New West Partnership. Under the new changes, instead of being taxed by volume, $1.25 is applied to every litre of beer outside of the North West Partnership. So this means that smaller breweries that were once charged by volume of production are now charged the largest tax rate.

This is where the issues arise – selectively taxing beer outside of the province is illegal within the bounds of the Constitution.

As a result, Ontario based Muskoka Brewery has now left the BC, Alberta and Saskatchewan markets, citing the increased taxes as the reason. Owner Gary McMullen says that the $2 increase per 6 pack was just too much to pass on to consumers and not only could have ended up pricing his product out of the market, but would have reduced profit margins significantly. Bo, an importer from Artisan Ales based in Calgary says her stock was taxed over night with no warning. And at a time where she usually has the most stock on hand to prepare for the Christmas season.

On top of this, Steam Whistle brewery based in Ontario, is also in the midst of court proceedings against the NDP as a result of waking up on October 28th to a 77 cent increase in taxes on their product. And they were recently granted an injunction by the Court of Queen’s Bench that suspended the increased tax on craft beer produced outside of BC, AB and SK until a hearing on the tax occurs on July 21.

For a free country, it seems like the government of Alberta is too involved in deciding the fate of businesses and consumer choice.

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commented 2016-02-18 18:06:43 -0500
Hi Holly. Good to see that you don’t just protect us from oil tax, but from beer tax as well.
commented 2016-02-18 12:21:21 -0500
I consult in the industry. Alberta and BC has had many new Beer Manufacturing Licence requests since this eastern beer tax was in the works. It gives Western Canadians an advantage over Eastern Canadian large craft breweries and encourages business development in Western Canada. Don’t look at this as a Nutly move. It was going to happen before the election. Anyone who believes that Western Canada should be autonomous from Ontario/Quebec interference should applaud this change and enjoy their new beers.
commented 2016-02-18 12:04:52 -0500
Bill Elder – I am a huge consumer of craft beer from all over North America, and yes some breweries brew better than others. I suggest you try Lacombe’s Blind Man River Brewery. They are doing things right and local. I too hate the FUN TAX.
commented 2016-02-18 11:20:47 -0500
Fraser asked, “Does anyone remember when Albertans got a TAX BREAK?”

Yes, but those days have vanished as fast as the first beer of a hot day.
commented 2016-02-18 11:17:58 -0500
The NDP said they put the tax in place to support businesses. What alternate universe do the NDP live in? In this universe on this planet raising taxes (or adding a new one) to a product does not in any way help the business.

NDP = no business sense whatsoever.
commented 2016-02-18 11:12:08 -0500
Want to take cocal craft brewing over the top ASBA members? Three business concepts for ya; conditioned water, style innovation and style diversity.

I have found Alberta craft brews to be bland and uninspired in comparison to BC or Ontario Craft brews for some tome now. I hope the craft brewing industry isn’t succumbing to the “Minhas” syndrome of vapidizing beer intensity to suit the palates of the canned lager sports bar piss-up demographic.

If you need protectionism from competitors maybe it’s time to look at what’s coming out of your bright tanks these days – or the evolutionary stage of your consumers
commented 2016-02-18 10:58:22 -0500
If it moves TAX IT if you can drink it TAX IT if you can smoke it TAX IT If you live in Alberta TAX IT
Does anyone remember when Albertans got a TAX BREAK?
commented 2016-02-18 10:57:28 -0500
Maybe if WildRose brewing et al stepped it up a notch they wouldn’t be so threatened by the superior crated brews imported from the US and BC.
commented 2016-02-18 10:50:30 -0500
Picture a drain and swirling as Alberta goes down the drain. Just say thanks to those who voted for the NDP and pay the taxes now you know what it’s like living in Ontario
commented 2016-02-18 10:24:52 -0500
I delight in the enormous selection of beers that can be got in Texas. Yes, and it’s not all Coor’s and Bud. There’s an explosion of excellent craft product and international imports available – and very low prices. I can go into any speciality brews establishment and select from literally hundreds of choices.

Yes, Freedom is really in Texas – and it tastes very good, Canadian weirdos.
commented 2016-02-18 10:23:26 -0500
Boston, December 16th, 1773