Taxpayers federation flags federal alcohol tax escalator

Canadians are paying more to buy a case of beer, bottle of wine or spirits as the tax on liquor increased April 1.

The 1.5 per cent tax hike is part of the federal government’s liquor tax escalator, which automatically raises the taxes based on inflation each year.

“I don’t know if someone in the Department of Finance has a dark sense of humour, but it’s not an April Fool’s joke — your taxes on beer, wine and spirits are going up every year,” said Aaron Wudrick, federal director of the Canadian Taxpayers Federation (CTF).

He said the CTF is raising a flag on this issue even though consumers won’t necessarily notice a big difference in prices at the till.

“The size of the hike is not actually that large, it only works out to a couple of cents on a case this year, but what’s unique about it is that it’s automatic every year,” Wudrick said.

“They’re calling it a tax escalator, so rather than having to announce it every year in the budget and tell folks that their taxes are going up — it just goes up automatically every year based on the rate of inflation.”

Wudrick maintains this is a serious problem because people deserve to know when their taxes increase to hold governments accountable.

Since alcohol is already taxed at a high level, Wudrick said the tax escalator will only add to the pressure on breweries and distilleries.

“It really puts the squeeze on retailers in this country when people can slip across the border and save a lot of money,” Wudrick commented.

The CTF has launched an online campaign to oppose the tax escalator.