Conservative Leader Pierre Poilievre has vowed to end the automatic annual alcohol tax hikes brought in by the Liberals, adding that he would bring the tax rate back down to 2017 levels.
Poilievre’s pledge came the same day that the consumer portion of the carbon tax was paused by Liberal Party of Canada Leader Mark Carney after months of pushing by the Conservatives. The new pledge has earned applause from taxpayer advocates.
“Poilievre just promised major alcohol tax cuts and taxpayers will cheers to that,” said Franco Terrazzano, federal director of the Canadian Taxpayers Federation.
But Terrazzano said that the celebration of future prospects might be dampened by the fact that the federal Liberals just hiked alcohol taxes again.
He explained that the recent hike would cost Canadian taxpayers $40 million this year. Since 2017, when former prime minister Justin Trudeau’s government introduced the escalator tax, Terrazzano said Canadian taxpayers have forked over more than $900 million for it.
The alcohol escalator tax automatically raises federal excise taxes on beer, spirits, and wine annually on April 1st.
By 2023, taxes accounted for the majority of the cost of alcohol. Fifty per cent of beer’s cost was taxes, followed by 65 per cent of the cost of wine, and 75 per cent of the cost of spirits.
The recent two per cent tax increase on April 1st followed a 4.7 per cent increase in 2024.
While the escalator tax is unaffordable, Terrazzano said it is also “fundamentally undemocratic.”
“If those politicians think you aren’t paying enough tax, they should at least have the spine to vote on the tax increase. But that’s not what’s been going on,” said Terrazzano.
While helping Canadian consumers, the federal director of the CTF also said that Canadian brewers will rejoice after raising concerns about making it through the tariff war. He added that life will improve for Canadian restaurants, breweries, distilleries, wineries, and more.
“This tax adds tens of millions of dollars in costs across the alcohol supply chain every year, making it harder for restaurants to turn a profit and harder for local producers to compete. Even worse, this annual tax hike is automatic, meaning it gets increased without a vote in Parliament,” reads a press release issued by the Conservatives.
The Conservatives called the automatic tax hike an “affront to our democracy,” as it is a tax increase not voted on in Parliament.
The party similarly pledged to cancel all future automatic tax increases.
The Canadian Taxpayers Federation has a petition that calls on the federal government to axe the escalator tax on beer, wine and spirits.
Terrazzano called on all federal parties to commit to halting the undemocratic tax hike.