On October 8, 2024, Deputy Prime Minister and Minister of Finance Chrystia Freeland and Minister of Small Business Rechie Valdez announced important news for Canada’s beer industry: two new measures aimed at providing relief from beer excise taxes.
First, the government has decided to limit the annual tax increase on beer, wine, and spirits to no more than 2% for the next two years. This change is crucial because, under a previous inflation-based formula, taxes were scheduled to rise by 4.7% on April 1, 2024.
By capping the increase, the government hopes to give the beer industry some stability during challenging economic times.
Second, there is a new tax relief measure for brewers. Starting now and continuing for the next two years, each brewer will receive additional tax relief on their first 15,000 hectoliters (hl) of beer production.
This means that smaller brewers, especially the 1,240 Canadian breweries producing less than 15,000 hl annually, will benefit significantly, with reductions in their excise duty rates ranging from 80% to 90%.
CJ Hélie, President of Beer Canada, expressed gratitude for these announcements, saying they provide “critical predictability” for the beer sector and “fiscal breathing room” for brewers. He noted that these measures would positively impact not only the brewers but also everyone involved in the beer supply chain, from farmers to bars.
This relief comes at a time when many Canadians are feeling the pressure of rising costs due to ongoing inflation and increasing interest rates.
As families tighten their budgets, enjoying a pint of beer with friends or family may feel less affordable. The government’s actions aim to help ensure that Canadians can continue to enjoy local beers while supporting their communities.
Hélie also thanked Members of Parliament for their support in addressing the economic challenges facing the beer and hospitality sectors. He highlighted the collective effort of consumers, local businesses, and organized labor, all of whom called for this tax relief.
Overall, these measures signal a positive step for the Canadian beer industry, helping to protect jobs and promote local breweries during tough economic times.
