Hon. Robert Black: My question is for the Government Representative in the Senate.

The government’s Budget Implementation Act, 2017 introduced a tax provision on beer, wine and spirits which would result in an automatic increase to excise duties at the rate of inflation every year. When the escalator alcohol tax measure was first proposed, Canadian brewers, wineries and distillers indicated to the government that it was a bad idea to impose a permanent, automatic tax-increase mechanism that would not take into account economic conditions.

They were not alone in calling for its removal; in fact, the Standing Senate Committee on National Finance passed an amendment to the Budget Implementation Act, 2017 to remove that escalator tax. However, it was ultimately unsuccessful in the other place, and this chamber did not insist upon the amendment.

As such, we will see an increase in alcohol taxes of over 6% this coming April.

Canada already has some of the highest taxes in the world: On average, 47% of the price of beer, 65% of the price of wine and 80% of the price of spirits are allocated to taxes. As of 2021, Canadians were already paying about $20 billion per year in alcohol taxes. Any further increase in tax will harm not only our breweries, wineries and distilleries, but also those along the supply chain.

Senator Gold, will the government commit to re-evaluating the alcohol escalator tax to ensure Canadian consumers, alcohol producers and those involved along the supply chain — from agriculture, to manufacturing, to the food services industry — are taxed fairly?

Senator Black: Senator Gold, we know that bars and restaurants were deeply impacted by the pandemic. Further increases in alcohol tax will increase their already-high operating costs, and will reduce their ability to attract customers and retain employees as these businesses continue to work to survive. I would like to highlight that the escalator tax not only impacts the hospitality sector, but also the agriculture and agri-food sector, other supply-chain members and consumers.

I think many of you would agree that now is not the time to increase alcohol taxes on Canadians, or on our struggling restaurants, bars and domestic alcohol producers.

Senator Gold, as we all know in this chamber, the government is already working on measures to implement Budget 2023. In the interests of saving all Canadians money, will you ensure your government is aware of this issue, and remind them of this chamber’s amendment in 2017, as they prepare for their upcoming budget implementation act in 2023?