A Good Beer Blog

Canadian Beer Laws

Canadian Beer Laws

by Alan McLeod.

As a lawyer in the Great White North, I feel badly for the Canadian microbrewer every time I come across another regulation that tries to cut the knees out of their entrepreneurial spirit. We have one province that limits the seating capacity of brew pubs, another that deems the government owns all the beer as soon as it is put in a container and yet another that has a law that effectively bans having a beer in the shower! I had no idea that the privies, lavatories and toilets of Manitoba were at such risk.

I asked some of Ontario smaller craft brewers about the troubles they face from the the state of the law in the land today. Joseph Tuer at Stratford Brewing Company (www.stratfordbrewing.com) had to scratch his head at the Federal excise officials who required him to to calibrate his second-hand US bright tanks into hectolitres. The Federal Government charges excise tax on the manufacture of beer and charges according to the measurement in these tanks. They were not content to calibrate according to the US gallon and then make the conversion from gallons to litres on paper, the tanks themselves had to be altered. This over-attention to the under-important cost money that could otherwise be used to spread the word about good beer or even lower the cost of a craft brewer's best.

It is not all bad, however, as the recently elected national Conservative government gave the micro-brewers a huge break by slashing the rate of that excise tax. For Steve at Beau's All Natural Brewing Company (www.beaus.ca) the effect was huge. "We've forecast sales of 1,000 hectolitres (100,000 litres) in our first year of operations. As we're at the smallest tier, we get the full 90% reduction - about $0.25 per litre. That represents a savings of $25,000 if we meet our sales goals." This 25,000 will go into promoting the new brewery to get them to the break even point sooner.

Sadly, as anyone who has shopped for beer south of the border is all too aware, taxes and what can only be called price fixing in Canada keep the price of beer high. While some provinces like Saskatchewan add another 10% on beer on top of general sales taxes that can top 16%, most go further and operate the beer market as a state wholesale and retail monopoly. The Ontario's LCBO uses that monopoly power to require that brewers and all other suppliers give them what they call the best price. What it means is that if a brewer strikes a deal with another buyer that is lower than the LCBO paid, the LCBO gets a refund for the difference. This effectively kills the marketplace and any incentive a craft brewer has to haggle while trying to find his market.

In the end it is not even the state of the law that can bug a brewer most. For John at Church-Key Brewing (www.churchkeybrewing.com) the real bother is inconsistent application. He says "at the licensee level AGCO enforcement officers strictly enforce some rules and completely ignore others." This sort of thing leaves brewers at best guessing how to do their job and at worst facing a rule that is not being applied to the next guy.

As Pete Brown wrote in his recent book Three Sheets to the Wind, "more than climate or genetics or anything else, drinking behaviour is governed by culture. And that culture is created by the laws that govern it." I would suggest the same is true for brewing culture.