Ontario craft brewers taxed eight times higher than those in Alberta
ONTARIO—While everyone is decrying about being taxes being so high, just think what it is like for an Ontario craft brewer, including those on Manitoulin lsland, who say the tax rate for Ontario breweries is eight times as high as those in Alberta.
“My understanding is that Ontario has the highest craft beer taxes in Ontario. Our industry feels we are being unduly taxed in comparison to other provinces,” said Andrea Smith, president of Split Rail Brewing Company in Gore Bay.
Mishin Meawasige, co-owner of Manitoulin Brewing in Little Current told The Expositor, “We are definitely in support of our Ontario association and our fellow craft brewers in Ontario. This is a good opportunity to review and look at meeting the needs of producers. We are in a dynamic industry but for about three years the craft brewers industry was significantly impacted by COVID-19 and we still have t deal with high taxes.”
“Hopefully something is worked out and we can be on a balanced playing field as craft beer producers in Ontario,” said Mr. Meawasige.
Split Rail Brewing and Manitoulin Brewing are members of the Ontario Craft Brewers (OCB) and support the Keep Craft Beer Local campaign. The goal of the campaign is to raise awareness that high taxes are the biggest threat facing local craft breweries and to call for tax fairness to keep brewing their beer.
“We started this craft brewery because we love Manitoulin. Local is what makes craft beer craft beer,” said Ms. Smith. “This and other craft breweries right across Ontario are where people gather, where our friends and neighbours and families work. We’re lucky in Ontario to be able to enjoy some of the best craft beer in the world, but the current beer tax system is putting the future at risk. For example, the craft beer tax for Ontario brewers is eight times higher than breweries in Alberta where a fairer tax regime has allowed the craft beer industry there to grow at a much higher rate.”
The OCB said that “Lowering the tax burden on our local craft breweries will help breweries hire more people, invest in their brewery, and build stronger communities. In fact, a recent study by the Canadian Centre for Economic Analysis (CANCEA) found that with the right tax and regulatory changes, Ontario’s craft beer sector could grow by an additional 40 percent, and in turn create over a thousand new jobs in communities right across our province.”
“Some breweries are closing, that has left communities across the province without their local craft brewery and the great jobs they offered,” the OCB says. “It is time we build a tax system that is fair for Ontario craft breweries. It will help support our local community, create jobs, and ensure our local craft breweries across the province grow and thrive.”
Ontario’s craft breweries are a significant economic driver across the province, especially in rural and Northern communities. Between 2010 and 2019, craft beer was the fastest growing segment of Ontario’s manufacturing sector, growing from 40 breweries to over 300, the OCB reports. Today, these small businesses and job creators employ 4,600 people full-time and contribute more than $685 million annually to Ontario’s gross domestic product.
“Local is what makes craft beer craft, and our local breweries are where we gather, where our friends and neighbours work, and are part of the fabric of our communities,” said Scott Simmons, OCB president said in a news release. “But the local craft breweries we all love are being put at risk by the fact that they currently pay the highest taxes of any craft brewery in Canada. We are excited to launch the Keep Craft Beer Local campaign because we need to lower the tax burden on local breweries to help them grow and succeed and ensure the craft beer we love keeps being brewed right here in the communities we call home.”
The taxes include a basic beer tax, a beer volume tax and, if applicable, an environmental tax. CBC News reports it as 39.5 cents a litre for the basis tax, 17.6 cents a litre beer volume tax and a potential environmental tax of 8.93 cents for each non-refillable container. The tax system in Alberta and British Columbia that the OCB prefers adjusts rates based on the size of brewery.
“The campaign’s message is simple, local is what defines craft beer, and we need to build a tax system that is fair for Ontario craft breweries like ours and helps keep craft beer local,” said Ms. Smith. “We encourage everyone to visit www.keepcraftbeerlocal.ca and let the government know that local Ontario craft beer matters and that we need to make sure we can keep brewing outstanding beer, creating good local jobs and supporting the community we love so much.”
