The Canadian Craft Brewers Association (CCBA) responded to recent news earlier this month that the federal excise tax for beer will go up by 6.3 percent on April 1st, based on 2022’s rate of inflation.

“Canadians across the country are already feeling the pinch caused by the current inflationary crisis, and craft breweries are no exception. The cost of everything that goes into producing Canadian craft beer has gone up, including hops, barley, and aluminum cans,” began Christine Comeau, Executive Director of the CCBA.

Canada is home to over 1,100 craft breweries that account for over 21,000 jobs in Canada. 55% of craft breweries are in rural areas, contributing to a “rural renaissance” across the country.

“The vast majority of Canadian craft breweries are less than 5 years old, and most are not yet profitable. These small businesses are already struggling with inflationary costs, and another tax increase will make it difficult for some to survive,” continued Comeau.

The CCBA, in partnership with the Coalition of Canadian Independent Craft Brewers, have recently recommended in February that the federal government introduce a progressive, revenue-neutral, federal excise rate schedule for beer to promote growth for Canada’s independent craft breweries. This new schedule would introduce lower rates for those at the lowest volume tiers to help breweries become profitable, and extend rates for a longer period of time before the maximum tax is reached.

“To support Canada’s growing craft brewing industry, it’s time for the federal government to modernize the Excise Act, one of Canada’s oldest pieces of legislation. Craft breweries cannot wait any longer, especially as the government is set to introduce a record-breaking tax increase on April 1st. It’s time to ensure that Canada’s craft breweries can continue to be a vehicle for middle-class job creation which supports a more prosperous, more inclusive, more sustainable, and more resilient economy in rural and urban communities from coast to coast to coast,” concluded Comeau.

SOURCE: CCBA