Interprovincial Trade Deal Offers Nothing for Alcohol Producers

In response to the Government of Canada’s Interprovincial Trade Deal announced last week, Conservative Interprovincial Trade Critic MP John Barlow tabled Bill C-351, An Act to amend the Importation of Intoxicating Liquors Act and the Excise Act, 2001 (importation).

Although there were high hopes for the Canada Free Trade Agreement announced on Friday, many Canadians were disappointed when they found out it contains hundreds of exemptions, including alcohol.

“The Liberal government had an opportunity to stand up for these businesses, but they failed by increasing taxes and agreeing to leave alcohol out of the Canada Free Trade Agreement,” said Barlow. “It’s completely unacceptable.”

The Liberal budget included a 2% increase in the excise tax with an escalator clause. Now, alcohol producers will see an annual tax increase, putting many Canadian brewers, distillers, and vineyards at risk of closing.

As it currently stands, the Importation of Intoxicating Liquors Act restricts the ability for producers to sell outside their own province unless they are granted permission by a liquor board of another province.

“It’s absolutely crazy to me that I can’t buy an Alberta craft beer, a Canadian product, when I’m in Ottawa,” said MP Barlow. “It’s a shame our archaic system stifles the growth of local business and the Canadian economy. Many of these craft breweries, distilleries and vineyards are providing much needed economic opportunities in rural communities across Canada.”

The changes proposed in Bill C-351 will give consumers greater choice, improve market access for Canadian alcohol producers, and will grow the Canadian economy while creating thousands of new jobs. If passed, this Bill would allow producers to sell their product directly to consumers anywhere in Canada without permission of a provincial liquor board, and would allow a person to transport alcohol from one province to another for personal use.

BACKGROUND

• A consortium of business groups, including the Canadian Federation of Independent Businesses, say that barriers to internal trade cost the Canadian economy nearly $15 billion per year.
• The Conference Board of Canada estimates that removing internal trade barriers would add $4.8 billion to real GDP and create 78,000 jobs in British Columbia and Alberta alone.
• Estimates show that eliminating provincial trade barriers in Canada would add anywhere from $50 Billion to $130 Billion to Canada’s GDP – That’s 4-10 times more GDP growth than that of CETA.
• 87% of small and medium enterprises believe that barriers to internal trade are unjustified in a modern economy and that governments should make removing such barriers a priority.

TESTIMONY

“We support the efforts of MP John Barlow in helping “free” Canadian craft beer. Having direct access to consumers outside our home markets would open up a great new specialty beer market.”
 Brian Titus, President
Garrison Brewing Co.
“This Bill would enable the Craft Brewing Industry to grow even more, giving our customers access to our beer right across the country. Like everything, times change and its high time we brought alcohol sales to the 21st century, since we are after all, in 2017.”
 David Howard, Co-Owner
Whiprsnapr Brewing Company
“Halo Brewery wholeheartedly supports this modernization of the Importation of Intoxicating Liquors Act. These changes will enable greater market access and growth for small businesses like ours. We’re also pleased that craft beer fans across the country will be able to enjoy products from small Canadian manufacturers that would not have been available to them otherwise.”
 Eric Portelance, Co-Founder
Halo Brewery

“It has been almost 5 years since the federal government amended the Importation of Intoxicating Liquors Act, to permit interprovincial wine delivery, yet only 3 provinces (British Columbia, Manitoba and Nova Scotia) have since opened their border to permit winery to consumer delivery. With the signing of the Canada-Free Trade Agreement, now is the time to reignite the discussion surrounding interprovincial trade. CVA commends John Barlow for bringing this issue to the House floor and we look forward to working with all levels of government to finally permit interprovincial winery-to-consumer delivery for all Canadians.”
 Dan Paszkowski, President & CEO
Canadian Vintners Association

“As the founder of Brew Box, I personally work with over 40 Ontario craft breweries; this non-partisan bill will create new jobs by allowing us to sell our products to all Canadians.”
 Robert Jackiewicz, CEO & President, Co-founder
The Brew Box Company

“Over the past 20 years Cameron’s Brewing has experienced significant growth within Ontario and we look forward to expanding to other provinces. Tearing down the interprovincial barriers and turning Canada into a genuine free-trade area will make it easier for small brewers like us to showcase their products on a national stage.”
 Bill Coleman, president and co-owner
Cameron’s Brewing Company