Canada: Inflation-Adjusted Alcohol Tax Rejected
Earlier this week, we published a news story about the contentious debate in the Canadian parliament about the government’s budget bill that would automatically raise taxes on alcohol each year in Canada.
Finance Minister Bill Morneau’s budget bill includes a 2% increase of the excise duty applied to the cost of alcohol. It would increase every year based on the rate of inflation. The government has said the cost to consumers will be minimal, adding only a penny to the price for a litre of wine, for example, seven cents for a 750-millilitre bottle of spirits, or five cents more for a 24-pack of beer.
This inflation-adjusted alcohol tax escalator seems to be rejected.
Senators vote 9-7 to amend budget bill, deleting inflation-adjusted future increases to beer, wine and spirit taxes #cdnecon #cdnpoli
— Bill Curry (@curryb) June 20, 2017
Evidence about alcohol-related harm and how to best prevent and reduce it, however, was on the side of the government. Data clearly shows that inflation-adjusted alcohol taxation helps protect public health and socio-economic development.