‘Beer tax’ capped at 2 per cent until 2026, Freeland announces

Finance Minister Chrystia Freeland says the federal government will cap the annual alcohol excise tax increase on beer, spirits and wine at two per cent for an additional two years.

The alcohol excise tax had been set to rise on April 1 by 4.7 per cent, tied to inflation, but Freeland announced on Saturday that the increase is being capped at the lower rate until 2026.

She also announced some tax relief for local craft breweries by cutting the excise duty rate in half for two years on the first 15,000 hectolitres of beer.

Freeland said Canada's small craft brewers are among the finest in the world and are an important contributor to the economy.

Restaurants Canada, which represents the country's food service industry, is applauding the move, saying the financial relief will give operators a chance to catch their breath as they try to cope with inflation and bounce back from the COVID-19 pandemic.

The Canadian Taxpayers Federation said while it is good to see some relief, the government shouldn't be raising alcohol taxes at all.