Canada’s cannabis industry says they need the same sorts of support provided to the country’s craft brewers.
In an announcement on March 9, the Canadian government said it plans to provide thousands of dollars in alcohol excise duty relief to Canadian businesses, particularly local craft breweries.
Canada’s cannabis industry has been asking for similar relief for years, with some noting their industry is larger and more heavily taxed and regulated than even beer makers.
In order to help alcohol businesses, the federal government is proposing to cap the inflation adjustment at 2% for beer, spirit, and wine excise duties for an additional two years, and to cut the excise duty rate on the first 15,000 hectolitres of beer brewed in Canada by half for two years. The government says this will provide the typical craft brewery up to $86,952 in additional tax relief in 2024-25.
In a press release, with comments from Deputy Prime Minister and Minister of Finance Chrystia Freeland and Minister of Small Business Rechie Valdez, the government acknowledges the number of jobs created by the brewing industry in Canada and the contribution this makes to the broader economy.
“This announcement is great news for breweries, distilleries, and wineries from all across Canada who contribute so much to our national economy,” said Valdez. “Not only are they producing incredible products, they are also small businesses who are creating jobs and opportunities in their local communities. Today’s relief on alcohol excise taxes will allow craft breweries to spend less on duties, and more on what matters most: growing and innovating their small businesses.”
Jonathan Wilson, CEO of Crystal Cure, a small-scale cannabis producer in New Brunswick, said he found the news difficult to swallow given how much his industry is currently struggling.
“For the Ministers to announce this excise tax relief for alcohol today, with the core message being to support small business in peril, it’s one of two things: cold-hearted or oblivious, and I can’t tell which one. Small cannabis producers that have been suffering under the current industry ecosystem, they are the ones without the cash flow to absorb the exorbitant taxes and fees, and they can’t sell at a loss in perpetuity. These producers were supposed to be the cornerstones of the industry, and it seems everyone is fine with them being allowed to crumble.”
POUR LIRE LA SUITE: StratCann