BC’s beer, wine, and spirits industry will be raising a glass after receiving a huge break from Ottawa.
During today’s (Tuesday) federal budget announcement by Finance Minister Chrystia Freeland, she stated the excise tax on all alcoholic products is being temporarily capped at two percent starting next month instead of the six percent spike that was previously reported.
Jeff Guignard who is the Executive Director at the Alliance of Beverage Licensees in the province told Vista Radio the whole industry is breathing a sigh of relief.
“It’s really nice that our federal government partner really listened to the industry here. Excise tax has been a part of our lives for decades and we have had no problems with increases of a couple of percent a year but when inflation is out of control like this, the last thing we need as we are trying to get back on our feet from the pandemic is an atrocious six percent increase.”
He added government and industry stakeholders now have a year to come up with a better markup and excise tax schedule that is more digestible.
There was a fear the six percent spike that was tabled would have been crippling to many bars and restaurants across the province – Guignard stated the budget announcement stabilizes the playing field.
“All the manufacturers are the ones who are paying the excise tax and now they can plan more effectively for a more logical, normal inflationary increase – not this generational, crazy increase. When you tell people they are going to get the largest tax increase in 40 years it was understandably a difficult pill to swallow.”
“It also means we can do a better job at keeping prices more affordable for consumers which is our real concern. When we are speaking on behalf of liquor stores, bars, restaurants, and pubs, all of their costs are going up and now we have one cost that is not going up astronomically so we are really thankful for that,” added Guignard.
According to Ottawa, they expect to rake in 100 million dollars in 2023-24 from the excise tax.