Eliminating the federal excise tax on low-alcohol beer would be a boon to health-conscious consumers and beverage manufacturers alike, says MP Richard Cannings.
Cannings, who represents South Okanagan-West Kootenay, on Thursday introduced in the House of Commons a bill that would make it so and hopefully in time for release of the 2022 federal budget in April.
“Just like the other low-alcohol choices we find in grocery stores, low-alcohol beer is a health-conscious and increasingly popular choice that we should not deter,” said Cannings in a press release.
“As someone from what the Lonely Planet has dubbed the ‘Craft Beer Capital of Canada,’ I am encouraged that fixing this error would likely help expand domestic production of low-alcohol beer. The removal of the excise tax on low-alcohol beer should be a welcome and easy fix.”
Canada has three tiers of excise tax for beer, based on alcohol by volume.
Low-alcohol beer that’s packaged in Canada and typically found in grocery stores contains 0.5% alcohol and subject to an excise tax of $2.89 per 100 litres. Standard beers with 5% alcohol are taxed at $34.82 per 100 litres.
According to Cannings, the federal government collected approximately $1.1 million in excise tax on low-alcohol beer in 2020.
“Canadians might not be aware but brewing high-quality low- and no-alcohol beer is a complex and costly process. Fixing this issue will send a positive signal to the industry and over the long-term has the potential to improve the selection of no- and low-alcohol beer options available to consumers,” said Luke Chapman, vice-president of Beer Canada, in the release.
“We thank Mr. Cannings and his NDP colleagues for their support of the Canadian beer industry, and the 149,000 Canadians whose jobs are supported by beer.”