April 2, 2018 7:37 pm
Updated: April 3, 2018 8:41 am

1.5 per cent price increase on alcohol tax now in effect

The price of beer, wine, and spirits is on the rise as a 1.5 per cent increase on alcohol tax has come into effect.

Dave Parsons
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The price of beer, wine, and spirits is on the rise as a 1.5 per cent increase on alcohol tax has come into effect.

Customers will only see fractions of pennies added to their bills now, but there’s no end in sight for the annual increases.

University of Regina economics Prof. Jason Childs said the hike works out to roughly half a cent per litre of beer, one cent per litre of wine, and 10 cents per litre of spirits.

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READ MORE: People in Saskatchewan are paying the highest price for beer in Canada

Childs doesn’t expect the rising tax to deter consumers, but said the extra cost could become significant as time goes on.

“There is only one pocket, and every time you go into that pocket, there’s less money for something else,” Childs explained.

“You’ve got the federal government basically going through the couch cushions trying to find every penny they can. Small cuts here, small cuts there, they’re looking for the non-politically dangerous places to cut budgets and raise revenues, and this is one of those places.”

The Canada-wide tax on domestic and imported beer rose by two per cent last year as part of the 2017 federal budget. As of April 1, Saskatchewan residents are also subjected to a two-cent increase for recycling charges on drink containers.

READ MORE: $17M added to certain fees and charges for Sask. residents and businesses in 2018-19

Regina-based Rebellion Brewing says it will not increase its prices as a result, instead hoping the rising tax will give an advantage to Canadian producers.

“It taxes the non-Canadian owned brewing companies quite handily and puts them at more of a disadvantage, which it should,” said Rebellion Brewing president Mark Heise.

“The people that are making great beer here in this country and keeping the profits here and employing people here, it doesn’t impact us as much.”

Like Childs, Jason MacKay is most concerned about the annual rate hikes.

READ MORE: Saskatchewan disappointed in Alberta’s beer tax appeal

The Canadian Taxpayers Federation Prairie director is calling on members of Parliament to stop the escalator.

“The government has a responsibility to ask for taxpayers’ permission to raise taxes. That’s the reason we have parliament, for them to vote on tax increases. If they believe they need more money, let them stand in the House of Commons and take responsibility for that.”

“These folks are going to get hit with higher taxes, and they’re not even going to know about it.”

READ MORE: La Ronge, Sask. considers putting limits on alcohol sales

© 2018 Global News, a division of Corus Entertainment Inc.

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