SoVote

Context: House Hansard - 171 - Mar/22/23

Mr. Tony Baldinelli (Niagara Falls, CPC)

Mar/22/23 8:24:09 p.m.
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Madam Speaker, when my colleague talks about the jobs that the government has created, he fails to recognize the impact of COVID on tourism and hospitality communities such as Niagara. During COVID, 40,000 people almost immediately lost their jobs. The sector is still struggling to recover, and regressive tax policies such as the escalator tax are preventing people from getting their full employment back. The impacts on restaurants are staggering, preventing restaurant owners from hiring those people back. How would he comment on that?

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Mr. Arif Virani

Mar/22/23 8:24:52 p.m.
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Madam Speaker, again, I highlight the member's advocacy for his sector of Niagara and the tourism that takes place there. It is critical to the Canadian economy, to the Ontario economy and to the region of Niagara. What I would put to him quite simply is that the issues I hear about in Niagara, from the tourism sector, do relate to acute shortages, but they are not tracing those acute labour shortages in the sector to the excise duty escalator. The 0.78¢ per beer is not directly impacting the industries he is advocating for. What is affecting them is things like the pandemic itself and things like acute labour shortages, people rethinking where they want to work and how they want to work. The ways we can address that are by encouraging more of the policies that are helping get people back to work, including through immigration, which we are strongly advocating for.

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Mrs. Claude DeBellefeuille (Salaberry—Suroît, BQ)

Mar/22/23 8:25:40 p.m.
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Madam Speaker, I want to respond to the speech by the Parliamentary Secretary to the Minister for International Trade by focusing specifically on the excise tax issue as it relates to small producers of currant wine or pear cider. As we speak, these producers pay an excise tax that is completely unjustified. Their production is so small that they cannot compete internationally and thus are unfairly taxed. Quebec has an abundance of artisanal producers who make alcoholic wines or ciders from berries. I am asking my colleague opposite, who sits at the decision-making table, if he will take the opportunity before the next budget to present to the minister the idea of exempting producers of pear cider or berry wines, who currently pay an excise tax. Thanks to the efforts of the member for Joliette on the last budget, we succeeded in exempting producers of mead and apple cider from the excise tax. Unfortunately, we have not had the time to get to other fruit producers—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Mar/22/23 8:27:11 p.m.
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I must allow some time for the hon. parliamentary secretary to respond. The hon. parliamentary secretary.

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Mr. Arif Virani

Mar/22/23 8:27:14 p.m.
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Madam Speaker, Blanche de Chambly comes to mind and its version with blueberries from the Saguenay region. It is important to support industries like microbreweries in Quebec and across Canada. As I mentioned in my speech, with the excise duties currently in place, the cap is 65,000 hectolitres, so we already have a system in place that benefits microbreweries. What needs to be studied is the issue of fruit in our alcoholic beverages.

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Mr. Richard Cannings (South Okanagan—West Kootenay, NDP)

Mar/22/23 8:28:08 p.m.
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Madam Speaker, I will just point out quickly, and I may be answering the previous question for him, that I do not think cideries and alcoholic beverages made from berries pay excise tax. That is my understanding. I would like to ask the parliamentary secretary what the government will be doing to make the excise tax writ large more fair for Canadians who have to compete with American companies, which have a much lower excise tax? Especially for small producers, small distilleries and breweries, it really puts them out of the market in terms of competition with those companies.

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Mr. Arif Virani

Mar/22/23 8:28:57 p.m.
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Madam Speaker, I appreciate the question from my colleague, who also sits on the trade committee with me. What I would say to him, quite directly, is that we are ensuring that our Canadian micro producers, whether that is for beer or wine from his region, etc., are competitive vis-à-vis their American counterparts, ensuring, first, that the quality of the product they are producing is competitive, and second, that the taxation system does not disadvantage them. That is something we have been advocating for, and that is something we will continue to advocate for.

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Mr. Francesco Sorbara (Vaughan—Woodbridge, Lib.)

Mar/22/23 8:29:29 p.m.
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Madam Speaker, I am pleased to rise today to speak to our country's economic situation. Our government understands that many Canadians are struggling to make ends meet during this period of high inflation. Fortunately, inflation in Canada has been slowly declining recently. The OECD expects inflation to return to its target level by the end of 2024. Inflation in Canada was 8.1% in June 2022. It has since fallen to 5.2% in February. Canadian inflation is still too high, but it is lower than what we see in many peer economies. It is going in the right direction, and going lower. For example, it is 8.5% in the European Union, and 10.1% in the United Kingdom. In fact, as we continue navigating through these difficult times, our country is faring much better than most other G7 countries. Canada is facing the same global economic headwinds from a position of fundamental economic strength, a sound fiscal balance sheet, an AAA credit rating, and an unemployment rate at a very low level. The facts speak for themselves. Our government made targeted investments to support Canadians and our economy through the pandemic, and these efforts are paying off. Last week, it was great to see the announcement by Volkswagen, which is bringing literally tens of thousands of jobs here to the province of Ontario and benefiting Canadians from coast to coast to coast. As a result of our government's leadership, Canada has experienced a strong rebound from the pandemic recession, with a 3%-plus growth rate in 2022, which is one of the strongest in the G7. On top of that, we continue to see the strongest increase in real disposable income in the G7. In addition, the more than 170,000 jobs created in January and February and a historically low unemployment rate of 5% clearly demonstrate the resilience of the Canadian economy. However, we recognize that many Canadians are struggling to make ends meet. Canadians are feeling the consequences of high inflation when they go grocery shopping, fill up their gas tank or pay their rent or mortgage. Unfortunately, we can no longer help everyone, as we did during the pandemic. That said, our government has put measures in place to continue to help those who really need it. We will help those most impacted by inflation. With regard to the excise duty on alcohol, when it comes in inflationary adjustments to the excise duty rates on beer or wine, I would like to reassure my colleagues that they do not generally represent an increase in real dollar terms. They broadly preserve the effectiveness of these excise duty rates over time and generally ensure rates stay constant relative to the product on which they are levied. Our government recognizes the important contribution that Canada's wineries, breweries, cideries and distilleries make to the national economy through job creation and the sale of high-quality products. That is why the government implemented the wine sector support program, which is providing up to $166.2 million to agriculture and agri-food in the 2022-23 and 2023-24 fiscal years. This will help wineries adapt to current and emerging challenges. Canadian small and medium-sized brewers currently benefit from reduced excise tax rates on the first 75,000 hectolitres of beer produced per year. This has provided support of up to $851,350 per brewer in 2022. The government also repealed the excise duty on non-alcoholic beer starting on July 1, 2022, to encourage growth in this sector of the beer industry. For the Canadians who need it the most, those most vulnerable, those most impacted by rising prices or inflation and those who feel the bite of rising prices most acutely, our government is there with inflation-relief measures. For example, we provided a one-time $500 payment to Canadian low-income renters through the Canada housing benefit. We cut regulated child care fees by 50%, on average, across the land. Here in Ontario, day care fees have come down 52.7%, representing up to $6,000 or $7,000 of real before-tax savings for families in Ontario in some instances. Those are hard-earned dollars that stay in the pockets of Ontario families, and our government led the charge on this. We collaborated and worked with all the provinces, and we got it done. It is helping Canadian families not only here in Ontario but across Canada. We have also doubled the GST credit for six months. This measure alone provided $2.5 billion in additional targeted support to the roughly 11 million individuals and families who already receive the credit. This includes the more than half of those receiving the benefit who are Canadian seniors. We enhanced the Canada workers benefit to put an additional $2,400 into the pockets of low- and modest-income families. We are also brining in the Canada dental benefit, which provides parents with children under the age of 12 who do not have access to dental insurance with direct payments of up to $650 per year, for a total of $1,300 per child over the next two years for dental care. It is estimated that 500,000 Canadian children will benefit from this targeted investment of $938 million. These are just a few examples of what our government is doing to help Canadian families from coast to coast to coast. However, we understand that our spending capacity is not infinite and that it is important that we continue to pursue a tight fiscal policy. The measures we are implementing to help Canadians are not adding fuel to the fire of inflation. They are simply providing targeted and fiscally responsible assistance to those who need it most. The Deputy Prime Minister reaffirmed the government's commitment to presenting prudent fiscal management ahead of budget 2023 at a recent meeting with chief economists for the major Canadian financial institutions. Canada has the lowest deficit and net debt-to-GDP ratio in the G7, maintaining our AAA credit rating through the COVID pandemic, and we are going strongly for the future. We also committed to $9 billion in savings from a government spending review in the 2022 budget. According to a recent OECD survey, Canada's net debt-to-GDP ratio is well below the average for the OECD, the European Union and the United States. This continued track record of fiscal strength has allowed the government to continue providing necessary targeted economic support to those who need it the most: those most impacted by the inflationary period that Canada went through and is still going through, but which is receding. In conclusion, Canada's economy is performing relatively well compared with the economies of our G7 peers, and there are good reasons for optimism. However, our government understands that many Canadians still need some support to get through these difficult times. That is why we will continue providing inflation relief to Canadians who need it the most and are the most vulnerable, for example, those who are most exposed to inflation and those on fixed incomes. We will continue doing so in a targeted, fiscally responsible way. The last thing we want is to make inflation worse. We are making life more affordable for Canadians while continuing to build an economy that works for everyone, helps the middle class and helps those working hard to join the middle class. As we prepare for budget 2023, we also understand the need for further investments to create good jobs for Canadians to ensure that Canada remains a competitive place to do business, particularly in light of the U.S. inflation reduction act. The Global Automakers were here this evening. I sponsored that event. It was great to see the representatives from Volkswagen there. Obviously, we congratulated them and I congratulated them on choosing Canada for their first North American battery plant. It is a plant for the future and creating thousands of jobs. As the global economy undergoes the most significant transformation since the industrial revolution, Canada cannot be left behind. That is why we will continue to work tirelessly to create more high-quality jobs, invest in our communities and build a more prosperous Canada for future generations. We are preparing measures that will give Canada the tools it needs to succeed.

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Mr. Todd Doherty (Cariboo—Prince George, CPC)

Mar/22/23 8:39:30 p.m.
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Madam Speaker, I appreciate our colleague across the way, but I do not think that he understands that every time they raise the costs for small business owners of doing business, there is a direct impact. Restaurants Canada has said that this tax increase would cost individual restaurants more than $30,000 per year on average. That is one staff member. That is a full-time equivalent or maybe a couple of part-time employees. These small business owners are going to have to make decisions on whether they hire students or more staff. These tax increases cost small business owners. They are so out of touch. Has this colleague ever run a small business? Does he understand that small business owners are now making decisions on whether they are going to keep the doors open or they are going to close? A tax increase of this magnitude is not just a cent on one can of beer; it has a very real human cost—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Mar/22/23 8:40:34 p.m.
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The hon. member for Vaughan—Woodbridge.

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Mr. Francesco Sorbara

Mar/22/23 8:40:37 p.m.
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Madam Speaker, it is great to see the hon. member for Cariboo—Prince George in the House. I know that area of the world very well, and it is great to see my friend. The over 18,000 small businesses that exist in the city of Vaughan have no greater champion than I, as their member of Parliament for the last seven years and before then. My relationship with the Canadian Federation of Independent Business, Restaurants Canada and all those stakeholders that the member mentioned is second to none. I have been a vocal champion for them. I have one of the largest wineries and winery operators in my riding. I meet with them regularly. I know the issues well. I chair the wine caucus here in Ottawa, and I continue to advocate for the issues that impact all sectors of the economy, especially the one—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Mar/22/23 8:41:26 p.m.
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I have to go to questions. The hon. member for Rimouski-Neigette—Témiscouata—Les Basques.

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Mr. Maxime Blanchette-Joncas (Rimouski-Neigette—Témiscouata—Les Basques, BQ)

Mar/22/23 8:41:32 p.m.
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Madam Speaker, I am very proud to represent the people of Rimouski‑Neigette—Témiscouata—Les Basques, but I am most proud of their expertise. I am proud of those individuals and entrepreneurs who are successful and who contribute to my region's economic development. Specifically, I am talking about the people who make beer, so microbreweries and microdistilleries. The motion we are discussing today mentions this sector. We are talking about people who get up every morning to grow our regional economy, develop their expertise and know-how and put our beautiful region on the map. Currently, we have a government that, despite the current context of inflation, intends to increase taxes on their products. That in the very antithesis of what the government claims to be doing, which is helping those who really need it. I invite my colleague from Vaughan—Woodbridge to call alcohol producers in his neck of the woods, specifically microdistillers and microbrewers, and ask them whether they agree with the excise tax increase. After talking to my constituents, I can say that they are totally—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Mar/22/23 8:42:48 p.m.
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I must give the member a chance to respond. The hon. member for Vaughan—Woodbridge.

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Mr. Francesco Sorbara

Mar/22/23 8:42:54 p.m.
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Madam Speaker, I want to thank my colleague for his question. It is very important to talk about the people who get up every morning and do that job. Those entrepreneurs who have actually made a success of our wine, craft brews and beer sectors in Canada and those individuals who created the wineries, whether in Quebec, Nova Scotia or in southern Ontario in the Niagara area, are individuals who took risks, created jobs and created wealth. I applaud them, and I will always advocate for them. One of the reasons I ran for office was to ensure that we have a strong economy, because we know that the economy we inherited from the Conservatives was not going anywhere. We turned it around, and we are going full steam ahead.

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Ms. Lori Idlout (Nunavut, NDP)

Mar/22/23 8:43:40 p.m.
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Uqaqtittiji, many other MPs have discussed beer distilleries in their ridings; Nunavut has one as well, NuBrewCo. This is a brewing company in Iqaluit, and it is already taxed territorially. I am concerned that this small distillery in Iqaluit will be impacted heavily by the taxes that are being proposed, and as such, I will be supporting the Conservative motion. Can the member talk about how the government will make sure that small distilleries like NuBrewCo will continue to get the federal support needed to keep operating?

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Mr. Francesco Sorbara

Mar/22/23 8:44:36 p.m.
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Madam Speaker, I know that our small business minister, the member for Markham—Thornhill, and the parliamentary secretary are working very hard to grow our small businesses. I encourage the member for Nunavut to reach out to these two individuals and me. We will obviously assist in any way possible. We will ensure that small brewers, big brewers and our wine and beer industry across Canada continue to grow, continue to foster and—

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The Assistant Deputy Speaker (Mrs. Alexandra Mendès)

Mar/22/23 8:45:05 p.m.
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Continuing debate, the hon. member for Joliette.

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Joliette

Mr. Gabriel Ste-Marie (Joliette, BQ)

Mar/22/23 8:45:08 p.m.
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Re: Bill C-19

Madam Speaker, I will be sharing my time with the hon. member for Abitibi—Témiscamingue. As members know, unlike sales tax, which represents a percentage of the value of a product, the excise tax on alcohol is a fixed amount by volume as set out in the Excise Tax Act. Traditionally, that amount was occasionally reviewed and adjusted to inflation through an amendment to the act. However, since 2017, the act has included an automatic indexing formula, which means that the amount of the excise tax goes up every year based on inflation. That is why the excise tax on alcohol is going to increase by 6.3% on April 1 to reflect the high level of inflation we have seen over the past year. Today's motion will not actually have a very big impact. We are talking about 1¢ per can of beer. This motion is not a real response to the increased inflation that is driving up the price of food in particular. This is a clear example of the populism of the Conservatives who are more interested in coming up with gimmicky slogans than they are in developing serious public policy. Furthermore, when it comes to beer, only large breweries will benefit from the adoption of today's motion. Given that microbreweries only pay a fraction of the excise tax, they will benefit far less from a freeze on the tax rate. Of the 1,200 breweries in Canada, including the more than 300 in Quebec, only 12 pay the full amount of the excise tax on the majority of their production. Most of these 12 breweries are owned by foreign multinationals. The decision to apply a different tax rate to microbreweries, the artisans who are passionate about agri-food living in every region, was implemented in the 2006 budget after the Bloc Québécois advocated for it for years. The Bloc Québécois has been fighting for our microbreweries for a long time. That decision would give them the opportunity to compete against the giants of the industry, whose production costs are much lower thanks to economies of scale. Since the implementation of the preferential rate, the number of microbreweries has skyrocketed and increased eightfold to our great pleasure. For a small artisanal microbrewery, indexing the amount of the excise tax might only represent a 0.1¢ or 0.2¢ increase per can. We are talking about that very small amount today. This means that when we buy a 12-pack of beer, we would pay an additional amount of just a little over 1¢. In budget implementation Bill C‑19 from spring 2022, the Bloc Québécois managed to extend to cider and mead producers the same support that had been extended to microbreweries 15 years ago. They are now completely exempt from the excise tax. Our support for small local producers is not limited to microbreweries. Unfortunately, since the government has a very restrictive definition of cider and mead, the producers who flavour their products with berries and aromatics continue to pay the tax. That is something we really hope to see resolved in the next budget, just like the application of the tax on wine made from other fruit such as pears, blueberries or even maple, which showcases our land. They should be treated the same way as our apple cider producers. For hard alcohol, we are talking about an increase of roughly 25¢ for a 750-millilitre bottle. Again, we are not talking about a catastrophic increase, but it adds to the overall price increases. With respect to spirits, frankly, the Bloc Québécois would have preferred that the Conservatives propose applying to microdistilleries the model that is already in place for microbreweries and impose only a fraction of the tax that is required of the industry giants. That would have a much greater impact. It would come down to about $3 per bottle rather than the meagre 25¢ that is being discussed today, but it would apply only to our small local producers. We hope the government listens carefully to what the Bloc Québécois is saying and will take it into account in its budget next Tuesday. Our small producers are suffering, struggling to compete with the industry giants. As I said before, they would benefit greatly from a more targeted measure. Unfortunately, that is not what today's motion proposes. It has very little impact on consumers. On every one of their opposition days, the Conservatives come back with their mantra: We need to lower taxes, cut EI by lowering the premium rate, cut retirement income by lowering the pension contribution—which also has an impact in Quebec, because the Canada pension plan and the Quebec pension plan are harmonized. They keep coming back to the idea of eliminating pollution pricing to pander to the oil companies. Today's motion, while not intrinsically bad, is along the same lines and does not represent a real plan to fight inflation. We are talking about 1¢ for a can of beer or 25¢ for a $40- or $50-bottle of spirits. This is not the end of the world, especially considering that alcohol represents only 4% of the average household's market basket. Skyrocketing housing and food prices are crushing Quebeckers and Canadians, especially those living on modest or fixed incomes. Measures that address the causes and effects of inflation would be much more useful than today's motion, which will have an essentially marginal impact on consumers. However, we do recognize that it could have a greater impact on restaurant and bar owners, who have been profoundly affected by the COVID‑19 crisis. As members are well aware, the Excise Act does not just determine the amount of the excise tax. It also determines the terms and conditions for the sale of alcohol. Along with the Importation of Intoxicating Liquors Act, it states that only the government of a province can import or distribute alcohol. Quebec or the province can delegate that responsibility to a private importer or distributor by granting them a licence, but the province holds the exclusive power to govern the importation and trade of liquor on its territory. The fact that international trade is an area of federal jurisdiction is incongruous, and I am going to talk briefly about the history behind that. Canada's first referendum took place in 1898. In the late 19th and early 20th centuries, many Protestant churches, particularly Baptist churches, were strongly advocating for the prohibition of alcohol. These prohibitionist movements were active in the United States and English Canada, just like in Lucky Luke. The Canadian plebiscite on the prohibition of alcohol, which was held on September 29, 1898, was on the passage of a law prohibiting the importation, production and sale of alcoholic beverages across Canada. This law on prohibition would have taken the form of an amendment to the Criminal Code. The yes camp won by 51.2% to 48.8%. It was a tight vote, but the yes camp won. However, the referendum exposed an important cultural divide in Canada. Every province except Quebec voted yes, but opposition to prohibition in Quebec was massive: 81.2% of the population voted against it, as they did in the case of conscription. The opposition was not only massive, but it was also very acrimonious. The members from Quebec in the House of Commons stated that they could not vote for a prohibition law because their families and communities would never forgive them. The prime minister at the time, Wilfrid Laurier, noted that there was a cultural divide between Quebec and English Canada on this issue. He felt that the federal Parliament did not have the legitimacy to legislate, which would amount to imposing the decision of the majority on the minority that wanted nothing to do with it—the French Canadians at that time—even though it had the constitutional power to do so. I hope the government is taking notes. It must not take unilateral action, and it should tell every province and Quebec to manage their own jurisdiction. That is how it was during the first years of Confederation. Instead of introducing legislation imposing prohibition across Canada, it chose to amend the laws on the importation and trade of alcohol and leaving it up to the provinces to regulate. That is why still today that responsibility falls to the provinces. Of course, this creates some inconsistencies, such as the ban on transporting alcohol from one province to another, which prohibits a resident of Ottawa from bringing home a bottle that he may have purchased at the liquor store in Quebec. However, the principle is interesting: If there is a difference between Quebec and Canada on a given topic, then the federal Parliament should refrain from imposing a blanket solution that applies indiscriminately from coast to coast to coast. I hope that the government and my colleagues from English Canada are listening carefully to this history lesson. I hope they will draw from it and stop imposing the will of Canada on Quebec when there is a difference of opinion, and delegate the powers. To my colleagues, I would say, “a word to the wise”.

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Mr. Mark Gerretsen (Parliamentary Secretary to the Leader of the Government in the House of Commons (Senate), Lib.)

Mar/22/23 8:54:59 p.m.
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Madam Speaker, I listened to the member's speech, and in particular the part where he talked about the various other issues that are genuinely impacting the daily lives of individuals throughout our country, such as inflation and the rising cost of food and other items. However, we are standing here talking about an excise tax increase that does not even add one cent per can of beer, as we heard previously. I am wondering if the member has any insight into why he thinks the Conservatives chose this as their opposition day motion when we could have been talking about some very important issues, some of which the member mentioned.

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