lilley: ontario residents want lower booze taxes, and they may get it
new polls shows ontario residents support lowering booze taxes, it's an idea the ford government is looking at.
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consider me shocked. people across ontario would like to pay less tax, in particular for their beer – craft beer that is. with the ford government considering a realignment of provincial taxes and fees for all alcohol in the province, the ontario craft brewers decided to take the pulse of the province on taxes.
a poll conducted last month shows that 71% of ontario residents believe that taxes on craft beer should be lowered and 75% believe lowering taxes will help ensure craft brewers are able to compete.
the government will have trouble disputing the poll results as the brewers smartly hired campaign research. that’s the same polling firm the government and the pc party use and it’s owned by doug ford’s political adviser nick kouvalis.
the questions detailed how ontario charges the highest tax rates of any province for craft beer and that means “local craft beer companies in ontario pay 8 times more in taxes than craft beer companies in alberta.” the poll then asked if taxes should be lowered and, not surprisingly, 44% strongly agreed that taxes in ontario should be more in line with other parts of canada, 27% somewhat agreed with that statement, 8% somewhat disagreed and 7% strongly disagreed.
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who are the 7% of people who want ontario’s taxes significantly higher on any product? if they really like paying taxes that much, maybe they can pay my tax bill.
in addition to 75% of ontario residents saying it was important to ensure craft brewers were competitive, 64% said the government should look at more measures to help “such as increasing shelf space for local beer.” that policy idea may be popular but is tricky for the government due to trade agreements, even the language in their policy of currently advocating 20% shelf space for local products has to be extremely precise to avoid trade challenges.
the craft brewing industry is likely to get their wish on an overhaul of the province’s current system which is antiquated and overly complex. when the province announced that it was speeding up the sale of beer and wine last may, they also announced a total review of taxation.
“the government will also conduct a broader review of taxes and fees on beer, wine and alcoholic beverages with the aim of promoting a fairer and more competitive marketplace for ontario-based products and consumers,” a news release said at the time.
the ford government has taken some heat with claims that it is needlessly obsessed with alcohol – odd given that premier ford doesn’t drink – but that criticism missed the fact that booze is a major contributor to the province’s coffers. the lcbo provided the province with nearly $2.6 billion last year, while excise taxes on beer, wine and spirits brought in another $593 million for a combined total of $3.2 billion.
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that’s before the sales taxes on booze sold in bars and restaurants is considered or all the other taxes generated by that industry.
this means the government will have to be careful that any move they make on changing taxes and fees doesn’t cut off revenue too deeply. that said, a study on ontario’s alcohol expansion commissioned by the convenience industry council found that provincial tax revenue could increase by as much as $147 million annually due to expanded sales.
while the government hasn’t made their position known at this point, the expectation from industry insiders is that sometime in the new year, possibly in a pre-election budget, the government will announce tax changes on booze. transparency is a key word that keeps being thrown around, so is simplicity.
“the problem is the government wants to make changes that don’t cost them anything,” said one industry rep.
another said they expect the ford government to drop some fees in the coming months, in particular at the lcbo.
the poll also asked about support or opposition to the expansion of where alcohol can be sold. it found that 23% strongly support the changes, 31% somewhat support them while 16% somewhat oppose, 23% strongly oppose and 7% declined to answer.
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