A longstanding B.C. craft beer business is brewing up support for structural tax changes in the industry.
While purporting to support local, the current provincial system is outdated and punitive to small brewers with impacts to businesses in Greater Victoria and beyond, says Gary Lindsay, owner of the region's Driftwood Brewery.
鈥淭hey鈥檙e at the breaking point,鈥� he said of craft breweries.
It鈥檚 a longstanding issue, amplified as the BC Craft Brewers Guild launched an official campaign earlier this month calling on residents to stop subsidizing conglomerates and support local craft brewers.
Small brewers can鈥檛 just lift the price, Lindsay said. 鈥淚t turns the consumer off,鈥� and they鈥檒l just shift buying power to one of the large companies. The guild is asking the province to revisit the markup schedule and address subsidization 鈥� including removing a $9 million subsidy.
鈥淵ou鈥檒l be helping a lot of the smaller breweries be sustainable and manageable and have a path forward,鈥� Lindsay said, adding it鈥檚 a way to back the supporting local stance.
The $9 million rebate cited is 5.5 per cent of what鈥檚 contributed by the three largest breweries to government revenue each year, according to the BC Liquor Distribution Board (LDB).
鈥淲e recognize the concerns raised by the BC Craft Brewers Guild and remain committed to reviewing the current beer markup structure,鈥� the board said in a statement to Black Press Media.
A review initiated last year identified the current markup structure as a priority for B.C. craft brewers.
"The review was temporarily paused to enable the LDB to prioritize urgent policy work in support of the provincial response to U.S. tariffs. Government is committed to resuming this work,鈥� the statement reads.
The structure was last reformed in 2015 to introduce a graduated markup schedule to benefit small and medium-sized breweries and remove barriers to growth, according to the LDB.
The three largest breweries that operate in B.C. receive rebates in relation to products produced and sold in the province, but are also subject to significantly higher markup rates than smaller breweries, according to the LBD. Rebates, also introduced in 2015, reflect that economic contribution and are not available to breweries that do not operate a facility in B.C.
鈥淲e recognize the concerns raised by the BC Craft Brewers Guild and are looking into the current beer markup structure to ensure it reflects today鈥檚 business conditions. We will continue to work closely with the guild to support the long-term viability of the sector,鈥� MLA Lana Popham, minister of agriculture and food, said in a statement to Black Press Media.
鈥淢any British Columbians, myself included, love local craft beer. These breweries are a valued and respected part of our communities. This is a challenging time for many craft brewers because of supply chain issues caused by the U.S. tariffs, increased competition, rising costs and a recent downward trend in consumption.鈥�
In the meantime, small local businesses are falling flat, Lindsay said. According to the guild, 20 have closed this year in B.C.
鈥淚t isn鈥檛 unusual in an industry with a lot of players, but the rate it's happening is concerning,鈥� Lindsay said, adding these aren鈥檛 just beer-makers, they鈥檙e community players and hubs.
He said small businesses support local arts, sports clubs and youth ventures.
鈥淎t our space down here in Esquimalt, we have a pretty popular tasting room and patio. It鈥檚 a community hub. It鈥檚 a place where people congregate,鈥� Lindsay said.
The economic impact also fans out to a host of trades, sub-trades and contractors.
鈥淎ll these industries have a role in the brewing industry. It鈥檚 harder to plan and invest in your future when you鈥檙e stuck in a position of negative margins.鈥�
