Take Action Now to Support a Reduction in Excise Tax on Canada’s Small, Craft Distillers!
Please take a few moments to show your support for reducing the tax burden on craft distillers in Canada by signing onto this petition that will be shared with federal election candidates. An election is an excellent time to have your voice heard. Let decision makers know you want to support local craft distilleries by reducing the excise tax on their products! Let’s Lift Canada’s Spirits!
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The federal excise tax on the production of spirits in Canada is too high for the 200-plus craft distilleries operating in our country to be competitive, invest in their communities and be resilient enough to recover from this pandemic. Under Canada’s escalator tax structure, that number is set to increase on an annual basis. Value added mark ups on spirits by provincial governments amplify the excise tax issues, hampering these small businesses. Currently, through successful excise tax reforms in the U.S. aimed at empowering small business, U.S. distilleries pay only $1.77/litre on their first 100,000 proof gallons. Canadian small distilleries are at a severe disadvantage by comparison, paying $12.736/litre.
US Small Distiller Excise Tax $1.77/Litre
Canadian Small Distiller Excise Tax $12.736/Litre
"This is the time to lean in and build back a more innovative, inclusive and sustainable future. While providing Canadians with the support they need to get through the pandemic, we need to invest now to ensure Canada has a strong recovery and is set up for long-term, sustainable and inclusive growth.”
- The Honourable Mary Ng, Minister of Small Business, Export Promotion and International Trade
Canadian craft distilleries are calling for the implementation of a tiered excise tax structure to allow local artisanal spirit producers to succeed:
On each producer’s 1st 100,000 laa (liters absolute alcohol): $2.50 /laa - 80% reduction
On volume above 100,000, but no more 500,000 laa: $6.50/laa - 49% reduction
On any remaining volume: $12.736/laa – full rate
There are approximately 225 craft distilleries in Canada, from coast to coast to coast. Like small breweries and wineries, they focus on using the grains, fruits, potatoes, sugar beets and other farm products found in the immediate area to produce something unique. Craft distillers typically bring local communities together, whether as a gathering place for neighbours or to enjoy something special with friends and family at home that was hand-made ‘in their own backyard.’
“Free spirits” by nature, owners of craft distilleries are both entrepreneurial and creative, with a strong commitment to participating in and giving back to their communities. The global pandemic has been particularly difficult for these small businesses, having lost the ability to share their products directly with customers at their distillery which was the bulk of their revenues pre-pandemic. While some of these small businesses have been resilient by moving to greater online sales, others have struggled and have not been able to make it through this pandemic. We believe all Canadians are looking forward to being able to enjoy one another’s company again soon at our favourite spots – including the local craft distillery.