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Tax to make up 50% of beer cost starting April 1

It appears now is a good time to stock up on beer with a tax increase coming in the spring.

Beverage alcohol tax has been tied to inflation in Canada since 2017, and it will automatically go up 6.3 per cent on Apr. 1. That is not an April Fool’s joke.

Beer Canada president CJ Hélie says it comes at a time when brewing beer is getting more expensive.

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“We had been in a one to two per cent inflation environment for some time, people got used to that. Then bang, almost overnight and we are getting into double-digit inflation,” said Hélie.

“What that means for the beer sector is barley prices went up 60 per cent, packaging 40 per cent and freight costs doubling.”

Hélie adds sales are still down compared to pre-pandemic, making it so that brewers are reluctant to push prices because of a slow rebound to the hospitality sector.

“It looks like in B.C. we are going to be down just under one per cent from last year – not anywhere near where we were in pre-pandemic levels,” said Hélie.

The reason for the lack of sales is that sporting events, concerts, festivals and other similar events had a slow reboot last year, according to Hélie.

He adds that the current cost of beer in the province is about 47 per cent tax. The new increase would see that number go over 50 per cent, making Canada have the highest tax on beer of any G7 country.

To date, Hélie says beer retail prices are up 5.6 per cent, and this coming April could see it jump another 10 per cent.

Vista Radio has reached out to breweries and liquor stores on Vancouver Island for comment, with one brewery saying the increase will “hurt small businesses.”

This story will be updated as more information becomes available.

~~With files from Will Peters,

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