“Cancel the beer tax”: CTF pressures Ottawa over automatic alcohol increase
The Canadian Taxpayers Federation is calling on Mark Carney to cancel a scheduled increase to the federal alcohol excise tax, arguing Canadians and businesses cannot afford higher costs.
The 2% increase is set to take effect April 1 under the federal government’s automatic alcohol escalator tax. The measure, first introduced in the 2017 federal budget, raises excise duties on beer, wine and spirits annually without a vote in Parliament.
“Canadians are struggling with the cost of everything and Carney shouldn’t make taxpayers pay more for a cold one,” said Franco Terrazzano, the federation’s federal director. “Instead of making life even harder for brewers, distillers, pubs and restaurants, the federal government should cut taxes to make Canadian businesses more competitive.”
Industry estimates suggest the upcoming increase will cost taxpayers about $41 million in 2026-27. Since the escalator took effect, it has cost consumers an estimated $1.6 billion, according to figures cited by the federation.
In a letter to the federal government, unionized brewery workers warned the increase comes as the industry faces additional financial pressures.
“We are increasingly concerned that another automatic beer tax increase, layered on top of tariffs, rising input costs, and stagnant sales, could push some breweries to reduce production and cut jobs,” the letter reads. “At a time when Canadians are struggling with affordability and workers’ futures are uncertain, it is difficult to understand how another tax hike on a proudly Canadian manufacturing industry could be justified.”
At the local level, Milt Olfert of Blumstein Brewing Co., said the increase will likely have a smaller effect on smaller breweries.
“Having said that the fee we pay now, if that would disappear or be reduced, that would make a big difference,” he said.
Olfert added the brewery plans to stay the course regardless of the scheduled increase.
“What we have going for us right now is that we are new and people are still curious who we are and want to try our beer.”
The federation says taxes from multiple levels of government account for roughly half the retail price of alcohol in Canada.
Terrazzano argued the automatic nature of the annual increase removes parliamentary oversight.
“Automatic tax hikes are undemocratic, uncompetitive and unaffordable and they need to stop,” he said. “If politicians think Canadians aren’t paying enough tax, they should at least have the spine to vote on the tax increase.”
