Taxes on alcohol in Canada to rise on April 1

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Canada’s distillers are asking federal Finance Minister Morneau to repeal what they call the “job-killing and pocket-picking” annual automatic escalator tax on beer, wine and spirits in the federal budget.

“Canada already imposes amongst the very highest taxes on alcohol in the world, and, in the case of spirits, 80 per cent of what you pay are taxes”, said Jan Westcott, President & CEO of Spirits Canada, in a statement.

Taxes on alcohol in Canada will rise on April 1 without a vote in Parliament – the third increase in three years. Federal excise duty revenues on Spirits alone rose 17.8 per cent last year.

“Today’s escalator tax is having the same negative effect it had when Canada last experimented with it in the 1980s; sky high prices, a freeze on investment, closed distilleries, lost jobs and Canada losing ground versus our international competitors”, said Westcott.

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Spirits Canada says Canadian spirits manufacturers source virtually 100 per cent of their cereal grains from local Canadian farmers, providing a valuable and stable customer base for generations of farmers’ highest-grade barley, corn, rye and wheat.

“We are calling for an immediate repeal of the escalator tax as a first step in a long overdue review and reform of Canadian alcohol tax policy”, added Westcott.

For many Canadians, higher prices can only mean more trips across the US border where booze is a whole lot cheaper, in many cases, even after factoring the duty one has to pay. One can bring 1L of alcohol (1L of spirits, wine and beer) and some tobacco into the U.S. regardless of the duration of the stay in the U.S., so long as the alcohol and tobacco is for personal use.

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You may have to pay taxes and duties on purchases over and above the customs allowance. This will be calculated by purchases over and above the customs allowance, you may be required to pay some nominal taxes and duties. This will be calculated by a customs official after you declare. -CINEWS

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