The Nelson Brewing Company is among many craft brewers in B.C. urging the provincial government to overhaul its tax structure, saying the current system favours large, foreign-owned companies while straining smaller local operations.
The BC Craft Brewers Guild recently launched its Protect BC Craft Beer advocacy campaign, calling for fairer taxation that supports local breweries.
Kate Walker, owner of Nelson Brewing Company, said the current tax model is squeezing small operations.
“Currently we pay 40 cents a litre, which works out to roughly $20 to $22 per keg in taxes. So, as you can imagine, that’s a pretty significant hit to our gross margin,” she said.
Walker said this structure penalizes growth.
Small breweries pay the same rate regardless of production, while large corporate breweries receive roughly $9 million in subsidies annually, with no increase to their flat rate since 2016.
“It’s like the more you grow, the more you pay. There’s not a lot of incentive to keep growing if you’re just going to end up paying a higher tax per litre,” Walker said.
Craft brewers in B.C. have also faced cost increases of around 30 per cent since 2020. This has forced more than 20 breweries to closed this year, and many more are on the brink of shutting down.
Tax reform, according to Walker, would allow small breweries an opportunity to reinvest in their communities.
“If we had some savings from the government, we could hire more local staff and optimize to reach our true potential,” she said.
The guild is proposing a graduated tax structure similar to models in Alberta, Saskatchewan and Ontario – which would give small brewers manageable rates and reward growth.
The guild has met with provincial agencies over the past 16 months, but Walker said progress has been slow.
“Mostly they seem to just be putting off a decision. We’ve had multiple meetings now, but nothing seems to have really come from it.”
The guild said its proposed reform is revenue-neutral and could save B.C. craft breweries $16.3 million annually – money to reinvest in jobs, ingredients and growth to counter U.S. tariffs.
The campaign urges the provincial government to work with the guild to find a sustainable solution that supports small businesses, removes barriers to growth, and keeps tax dollars in B.C. to help the industry thrive.
The province’s craft breweries employ more than 6,000 people province wide.
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