Canada extends 2% cap on alcohol excise duty inflation adjustment

Last April, the government introduced the temporary one-year cap of 2% on increases to excise duties on beer, spirits and wine. But that had been due to end in April, leading to a 4.7% rise in alcohol excise. However, the two-year extension of the 2% cap - announced on Saturday (March 9) - has been announced to ‘recognize the significant contribution that Canadian wineries, breweries, cideries and distilleries make to the national economy by creating good jobs and high-quality products'. Spirits Canada, the national trade association representing distilled spirits, has welcomed the 2% cap. “The choice to cap the excise tax increase at 2% represents alignment on the recommendations that the combined voices of the beer, wine, spirits, restaurant, and hospitality sectors made,” said Cal Bricker, President & CEO of Spirits Canada. “Since its introduction in 2017, the escalator tax, has subjected alcohol to automatic annual hikes based on changes in the Consumer Price Index (CPI). ...