Manitoba pulls U.S. booze, offers tax deferrals to businesses in wake of tariffs

The Manitoba government offered tax deferrals to businesses in the province Tuesday and pulled United States products from liquor stores in response to tariffs imposed by U.S. President Donald Trump.

Businesses affected by the tariffs will have the option of deferring payments of both the provincial sales tax and the health and post-secondary education tax levy — commonly called the payroll tax — for at least three months.

“This will start with the February tax period and go for three months before we reassess. This allows businesses to keep cash and protect your jobs,” Premier Wab Kinew wrote on the X social media platform, formerly known as Twitter.

The payroll tax charges employers a percentage of their payroll. Businesses with payroll of less than $2.25 million a year are exempt.

The ban on U.S. liquor is expected to affect about six per cent of products sold by Crown-owned Manitoba Liquor and Lotteries, including 409 spirits, 341 wines and many beers and other products. The ban only applies to products made in the U.S., not to U.S.-based brands such as Budweiser that are brewed in Canada.

1:48 Tariff talk: Brewers worry, while food prices could rise

Kinew has hinted at other retaliatory measures, such as forbidding U.S. companies from bidding on Manitoba government contracts, but there was no word on that possibility Tuesday.

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Keystone Agricultural Producers, a major agricultural group, says the U.S. tariffs will harm farmers and consumers on both sides of the border.

It said Manitoba’s agri-food exports were $9.28 billion last year, with 46 per cent going to the U.S.

“These tariffs will not only add costs and threaten Manitoba farmers’ ability to operate but will impact the livelihoods and purchasing power of countless individuals and businesses on both sides of the border, resulting in increased food costs for U.S. consumers,” the group’s general manager, Colin Hornby, said in a news release.

The Manitoba Chambers of Commerce said its members face a lot of uncertainty about the extent of the impact of the U.S. tariffs.

“Some of the companies that I’ve talked to do 70 to 80 per cent of their business south of the border,” chamber president Chuck Davidson said.

“How big of an impact is that going to be? Are those U.S. customers simply going to go away?”

5:34 Supporting Canadian brands: Smart alternatives to American imports