July 31, 2017 7:08 pm
Updated: August 1, 2017 2:45 pm

Alberta NDP’s beer tax contravenes Canadian internal trade rules: panel

File photo of glasses filled with beer.

THE CANADIAN PRESS/Darryl Dyck
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A spokesperson for Alberta Finance Minister Joe Ceci says the government is “still reviewing the decision” and will have more to say in the coming days after a panel ruled late last week that the controversial beer tax put in place by Rachel Notley’s government violates the province’s free trade obligations under Canada’s Agreement on Internal Trade (AIT).

On Friday, a three-person panel with the Agreement on Internal Trade said new tax rules for small brewers announced by the NDP in 2015 amount to discrimination against craft beer produced in other provinces.

LISTEN: Talk show host Rob Breakenridge speaks to Artisan Ales’ Mike Tessier.


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The panel was tasked with looking into a complaint filed by Artisan Ales Consulting Inc., a Calgary-based company that represents dozens of brewers across Canada. Artisan Ales argued an Alberta government policy announced in 2015 – that said small brewers outside the New West Partnership (British Columbia, Alberta, and Saskatchewan) would be taxed at a rate higher than small breweries within the New West Partnership provinces – broke trade rules.

READ MORE: Alberta beer-tax court challenge pushed to September

In 2016, the government adjusted its policy so that all craft brewers would be taxed at the same rate but to allow for Alberta brewers to receive rebates if they meet certain criteria.

However, in Friday’s ruling, the majority of the AIT panel found that both the 2015 tax provisions and the subsequent changes introduced in 2016 contravened free trade provisions in the AIT.

READ MORE: Alberta backtracks on graduated beer tax for craft brewers

Watch below: In July 2016, Shallima Maharaj filed this report about changes coming to the way beer is priced in Alberta.

The panel said “Artisan, as well as others importing beer into Alberta or brewing beer for import into Alberta, including Saskatchewan breweries, have suffered injury due to the measures” and called for Alberta to change its beer tax scheme so that it is compliant with the AIT “as soon as possible.”

READ MORE: Alberta importer says beer tax made profits plunge: ‘A policy destroyed our business’

Watch below: In June 2017, a Calgary beer importer was taking on the Alberta government, claiming a new beer tax was tanking their business.

 

A lawyer with the Canadian Constitution Foundation, a registered charity that says its mission “is to defend the constitutional freedoms of Canadians through education, communication and litigation,” issued a statement in response to Friday’s ruling.

“Hopefully this time the Government of Alberta gets the message: new taxes that discriminate against out-of-province craft beer not only hurt consumers by reducing selection and driving up the price of popular products, they violate the free-trade principles enshrined in our constitution and reflected in the Agreement on Internal Trade,” Derek From said. “Alberta should lower its beer tax back to pre-2015 levels so that we can once again become the best place in the country to brew, buy, and drink craft beer.”

You can read the AIT panel’s decision in its entirety below.

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