Due to an incredibly well run campaign and ceaseless lobbying by the Canadian Craft Distillers Alliance, Spirits Canada, Beer Canada and many other industry organizations the Federal government announced on April 1, 2023 that the undemocratic federal escalator tax applied to alcoholic beverages would be capped at 2% this year. This was a massive improvement over the projected 6.3% increase that distillers across the country were facing.
The work is not done yet. The CCDA has committed to working on behalf
of all small and craft distillers across the country to level the playing field between ourselves and our biggest competitive market, the United States. Introduction of a progressive taxation system, similar to the Craft Beverage Modernization Act in the United States, is critical if our industry is to thrive into the future. Small distillers across Canada are taxed between 7-12x what our competitive set in the United States pay. Imagine if this delta existed in an industry like automotive parts. No politician would let that stand. Our industry is no different.
Hardworking Canadian entrepreneurs and distillers, in many cases have invested their life savings, to create amazing products with incredible stories, are faced with increasingly slim opportunities with the highest alcohol taxes in the G7. Distillers across Canada are being squeezed by inflation on one side and an unsustainable tax system on the other. We need our own government to support this industry which is important to communities from coast to coast and now includes over 300 distilleries. Regulatory and tax revision is required quickly in order to regain ground on the rest of the world.
