A few weeks before its economic update, the federal government is being asked to freeze the automatic increase in taxes on beer, wine and spirits planned for April 1, 2024.
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On that day, the excise tax on alcohol is expected to rise by another 4.7%, estimates the Canadian Taxpayers Federation (FCC), in a context where taxes already account for almost 50% of the price of beer and 65% of the price of wine, on average in Canada.
After the brewing industry withdrew a significant portion of its CO2 tax last Friday, it is now hoping for a more lenient stance from the government.
“We hope MPs from all parties will take action to end the federal beer tax increase on April 1, 2024, to help ensure life remains affordable for Canadian workers and those working in hospitality and tourism,” explained Beer Canada on X.
The industry association estimates the increase will cost Canadians $96 million more next year.
In the Freeland Budget 2023, the government has capped the increase in excise duty on the price of alcohol to 2%.
The automatic increase introduced in 2017 was originally intended to be adjusted for inflation, but in 2022 the consumer price index (CPI) had risen 6.4% and Ottawa said it wanted to ease the financial burden on Canadians.
According to Nicolas Gagnon, FCC director in Quebec, this automatic increase is “undemocratic” because it is not subject to a vote in Parliament.
“These repeated tax increases unfairly impact restaurateurs and consumers, and it is time for the federal government to put an end to them,” he said in a news release.