Sales memos from the big breweries, and leaked to the Canadian Taxpayers Federation indicate that multi-nationals have increased prices to take advantage of increased taxes on small craft breweries.
“What we’ve seen from the Molson email is that Molson/Coors Black Ice discount beer has increased on a 15-pack as an example, seven per cent, or $1.18 per pack,” Paige MacPherson the Alberta director of the CTF said in an interview. “Labbatt also increased prices.”
That compares to tax and price increases on discount beers from a smaller out-of-province brewer, Great Western Brewing. The CTF said in a news release an 8-pack of Brewhouse Pilsner increased in price on August 5th by 27.9 per cent, or $2.34 per pack. A 24-pack increased by 21.4 per cent, or $5.82 per pack.
“The Molson e-mail explicitly says that they have increased prices on their discount beer to protect profitability after the opportunity existed for them to increase prices on that discount beer when the Alberta government raised taxes on their smaller brewery competitors.”
“It shows that policies that are bad can have unintended consequences,” MacPherson said.
“The government might be thinking that it’s helping small brewers with their beer tax hike and subsequent subsidies to some brewers but essentially what they’re doing is opening the door for big beer companies to raise their prices and that hurts consumers across the board.”
The Alberta government increased beer taxes to $1.25 a litre for all beers sold in Alberta on August 5th, 2015.
Companies like Saskatoon-based brewer Great Western and Toronto-based Steamwhistle Brewery are taking the Alberta government to court over its beer tax hike.
Michael Micovcin, President & CEO, Great Western Brewing Company, told the Ryan Jespersen Show the tax is an unconstitutional barrier to free trade.