TIMMINS — Ontario’s craft beer industry is facing the highest provincial taxes in Canada, a financial burden that small businesses like Full Beard Brewing Co. in Timmins say is putting their growth at risk. The province imposes a staggering 96 cents in taxes on each can of craft beer, including base beer taxes, LCBO fees, and can and volume taxes—eight times higher than Alberta’s rates.
The Ontario Craft Brewers (OCB) are urging consumers to contact their Members of Provincial Parliament (MPPs)—including Timmins MPP George Pirie—to express concerns about the impact of these taxes on local breweries.
For Jonathan St-Pierre, owner of Full Beard Brewing Co., the burden of the provincial beer tax is felt directly by the producers. “The beer tax just falls to us,” said St-Pierre. “It’s on us in production.”
The focus for craft brewers, like St-Pierre, is on the provincial tax structure, which charges the highest rates for products packaged in cans and bottles. The tax rate is lower for products sold on tap or in kegs, which encourages brewers to establish brewpubs to minimize their tax burden. However, St-Pierre emphasized that this creates a tricky balancing act, as breweries like Full Beard Brewing Co. also rely on local licensees for draft sales.
“We don’t want to impede on our licensees because we sell a lot of draft with our customers, so for us, we’re happy not being designated as a brew pub,” he said.
From 2010 to 2019, Ontario’s craft beer sector saw explosive growth, increasing from 40 breweries to over 300. Full Beard Brewing Co., which employs four local staff, is one example of the sector’s expansion, despite the financial challenges posed by the high tax rates.
The provincial government has acknowledged the issue and committed to reviewing the tax system for alcoholic beverages. In a statement to TimminsToday, Colin Blachar, Deputy Director of Media Relations at the Ministry of Finance, said, “The government will be conducting a review of alcohol taxes, mark-ups, and fees on beer, wine, and alcoholic beverages with the aim of ensuring competitiveness and value for consumers.”
While the government froze the basic beer tax in February 2024, promising no increases until 2026, St-Pierre argues that more permanent solutions are needed. “The taxes have been tweaked and changed repeatedly over the years, but a solid plan has yet to be put in place,” he said. “We’re trying to find a solution where it’s one strategic plan outlined for this.”
Blachar emphasized the government’s commitment to supporting local brewers, stating, “To support brewers and wineries to recover and grow and to save consumers money, Ontario paused the scheduled increase in beer tax rates and cancelled the scheduled increase in wine tax rates put in place by the previous Liberal government.”
For more information on the ongoing tax reform efforts and how the public can advocate for change, the Save Local Craft Brewing website provides resources and action steps.
As the debate continues, craft breweries like Full Beard Brewing Co. are watching closely, hoping for a solution that will allow them to thrive without being weighed down by the heaviest beer taxes in the country.
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