1. Bring Canadians back to neighbourhood restaurants and bars
Beer is a key profit driver for licensed bars and restaurants, with much higher profit margins than on food. In a typical year, restaurants, bars and tap rooms account for nearly 20% of beer sold in Canada with beer representing an estimated 15% of the sector’s overall profitability. Health and safety mandatory closures and capacity restrictions necessitated by COVID-19 had a devastating impact on these neighbourhood businesses in 2020 and 2021.
As employee and business COVID support measures are rolled back, it is imperative that the federal government adopt new progressive measures that encourage Canadians to return to their favourite restaurant to help these local businesses survive. This effort can be supported by:
Reducing the federal excise duty rates that apply to draught beer by 50%; and
Eliminating the April 2022 automatic annual federal excise duty rate increase on beer
As draught beer is almost exclusively available in establishments licensed for on-site consumption, a 50% targeted tax reduction would provide a critical lifeline for these establishments. More directly, licensed bars and eateries simply cannot afford any further tax increases on such an important menu item that is beer, whether served from a bottle, a can or keg. Smaller-scale brewers with a higher proportion of their sales generally occurring on-site and in draught would benefit particularly from these support measures.
2. Improve the Selection of Beer available to Canadians across the Country
Many adult Canadians remain frustrated that too often they cannot readily access beer brands brewed in another province. Canadians rightly believe that they should be able to access beer directly from Canadian brewers regardless of their province of residence.
The COVID-19 pandemic has accelerated the growth of e-commerce for a broad range of consumer products, including beverage alcohol. There is a critical leadership role for the federal government to ensure provincial measures do not disadvantage Canadian brewers from a significant segment of the future of modern retailing represented by e-commerce and direct-to-consumer sales channels.
3. Ensure Effective Public Health Policy
Canadian brewers have a long tradition in ensuring that beer is enjoyed, served and retailed responsibly.
“Beer Canada has shown true leadership in corporate social responsibility for decades and more progress could be achieved if other business sectors were as committed”.- Robyn Robertson, President & CEO Traffic Injury Research Foundation
Canada’s Low-Risk Drinking Guidelines recognize that at times “zero’s the limit”. On these occasions, non-alcoholic beer may be the best choice. But, under the Excise Act alcohol excise duties are still imposed on non-alcoholic beer in Canada.
Canada should follow the lead of other major western developed nations by encouraging access to non-alcoholic beer and
Exempt beer with an alcohol content less than 0.5% abv from all federal beverage alcohol excise duties.
Non-alcoholic wines and spirits in Canada already benefit from this 0.5% federal excise duty exemption and non-alcoholic beer should be provided equal treatment.