Evidence of meeting #163 for Finance in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was industry.
A video is available from Parliament.
Claude DeBellefeuille Bloc Salaberry—Suroît, QC
Thank you very much, Mr. Chair.
Thank you very much to the witnesses for their presentations.
My question is for Mr. Lambert.
My colleagues may not have heard you say this earlier, but in addition to representing the Union québécoise des microdistilleries, you are speaking on behalf of microdistilleries in Canada today.
Bloc
Claude DeBellefeuille Bloc Salaberry—Suroît, QC
Can you repeat the number of microdistilleries in Canada?
General Secretary, Union québécoise des microdistilleries
There are 300 craft distilleries in Canada. The CCDA represents all of the provincial associations, which in turn represent those distilleries.
Bloc
Claude DeBellefeuille Bloc Salaberry—Suroît, QC
Great.
Can you expand on the different approaches of the federal government in Canada and the United States? Can you also explain how the tiered taxation system you are proposing could have a competitive effect on the American market, for example?
General Secretary, Union québécoise des microdistilleries
In the United States, there are two production levels. For the first level, the normal excise duty is about $13 per gallon of absolute alcohol. For the second level, there is tax relief, and the excise duty is just under $3 a gallon, which corresponds to nearly $1 a litre in U.S. excise tax, as I mentioned earlier.
The difference really is that the U.S. responded to a growing industry, one that was meeting the needs of consumers and for which there was national interest. They took the opportunity to give this industry a boost. At the end of the day, it's not a gift to distilleries. Yes, it is, but the country's ultimate objective is to generate as much of a multiplier effect as possible. That's what we're seeing today. It's been six years since the U.S. introduced this relief, and billions of dollars have been pumped back into regional economies across the United States.
The industry is growing in Canada as well, but we have not yet responded to that reality, which is choking our distilleries. It's not just because of excise duties. Our laws and regulations pertaining to spirits are still very much a reflection of prohibition-era attitudes, both provincially and federally. If the federal government showed leadership towards this industry, it would be a good step forward, and the provinces could in turn draw inspiration from that.
Bloc
Claude DeBellefeuille Bloc Salaberry—Suroît, QC
You clearly illustrate that the industry is booming in Canada and that microdistilleries are making a name for themselves. I'm looking at Mr. Bériault, from Distillerie 3 Lacs, who is with you today. If I may say so, his distillery probably makes the best gin in Canada. Of course, it's a matter of taste.
Can you clarify what the average output of your union members is? I don't know if Mr. Bériault could answer that question more specifically.
Basically, what would the average savings be if we made the change you are proposing?
Nicolas Bériault Co-Founder, Distillerie 3 Lacs, Union québécoise des microdistilleries
I'll take that question.
Thank you for your compliment, Mrs. DeBellefeuille. We have in fact won gold medals in a number of Canadian and international competitions.
If the tiered relief proposal were implemented, approximately 90% of Canadian distilleries would be in the first tax bracket. That would represent an annual tax break of approximately $150,000 per distillery in Canadian dollars. That's a substantial amount of money for those distilleries. Lastly, it would give oxygen to an industry that really needs it and that still has to deal with tax rates that date back to the prohibition era.
Distilleries have not yet received a break, unlike microbreweries and wine producers. The brewing sector and the wine industry have had relief over the past few years. Distilleries, on the other hand, have seen four rate increases in the last five years. So we're not keeping up at all.
This relief would help us remain competitive with foreign products here in Canada. It would also allow us to increase our liquidity to further move into U.S. and European markets. We could also develop new technologies and remain competitive and innovative. That's not to mention the beneficial effect on local tourism in our regions.
Bloc
Claude DeBellefeuille Bloc Salaberry—Suroît, QC
As you said, Mr. Bériault, microbreweries were given some relief, and it had an impact on them.
Today, we are talking about microdistilleries. What do you propose in practical terms to improve the financial health of the members of your union?
In your opinion, the relief you are proposing would provide significant liquidity for each microdistillery. You gave an estimate earlier. That's not a lot of money compared to large commercial, industrial or international distilleries such as Diageo, in my riding. We're really talking about small and medium-sized businesses that have great hopes for their innovation and want to receive the same relief or support from the federal government as the brewing industry recently received.
Co-Founder, Distillerie 3 Lacs, Union québécoise des microdistilleries
Absolutely. It's important to point out that it's really to help the smallest businesses. It must be said that SMEs are an economic driver and are the foundation or pillar of our economy.
However, we are really lagging behind in this industry, because just 7% of the spirits consumed here are manufactured here in Canada. Compared to any other agri-food industry, we are well below typical levels.
The goal is therefore to boost the competitiveness of smaller businesses.
Liberal
NDP
Don Davies NDP Vancouver Kingsway, BC
Thank you, Mr. Chair. Thank you to all the witnesses for being here today.
To the National Council of Canadian Muslims, in 1949, the United Nations Relief and Works Agency, or UNRWA, was established to provide direct humanitarian relief and development for Palestinian refugees. It is funded almost entirely by voluntary contributions from UN member states, including Canada.
Can you describe the impact of UNRWA's work on Palestinians living in Gaza and the West Bank today?
Advocacy Officer, National Council of Canadian Muslims
Mr. Chair, UNRWA is exactly the way that it has been described. It's providing basic, life-saving aid to those who need it the most. We support providing international humanitarian assistance to everybody who needs it, and, in particular, today, to Palestinian civilians in Gaza, especially Palestinian children who are not only caught in the violence that's ongoing, but who are suffering a polio epidemic and are dying from things like malnutrition. UNRWA is helping there.
We support Canada to get aid to those children using the most effective means available as quickly as possible to save their lives. We don't think that children should suffer punishment because of the political conflict going on around them. That's why we support Canada to increase aid to those who need it most—not just Muslims, but Muslims, non-Muslims and all people who have the greatest need for this.
That's the kind of life-saving aid that UNRWA is providing. That's why we support Canada continuing to support it.
NDP
Don Davies NDP Vancouver Kingsway, BC
Now, there are some, including some people in this Parliament, who have called for UNRWA to be defunded. However, given that the UN Secretary-General, António Guterres, and sources as diverse as the U.S. ambassador to the UN, Linda Thomas-Greenfield, have been clear that there is no alternative to UNRWA for delivering aid to Gaza in particular, could you outline how defunding UNRWA would affect the overall humanitarian situation for Palestinian civilians, including children?
Advocacy Officer, National Council of Canadian Muslims
Mr. Chair, that question highlights and recognizes that UNRWA is the largest UN agency and has the most capacity to effectively deliver life-saving aid. If it were defunded, it would be an incredible disaster, the likes of which we've never seen. We've been disgusted by the attacks we've seen on UNRWA from various sectors. UNRWA runs hospitals and provides water and food to people who have been suffering from violence and displacement for over a year.
Defunding UNRWA, we think, would be unreasonable as a response to concerns about it. It would be as unreasonable as—if I can use an analogy—allegations of multiple MPs of different parties contributing to or participating in foreign interference. If we were to argue that based on those kinds of allegations, we should dissolve the institution of the House of Commons, we would not find that a reasonable response. Similarly, we should not defund UNRWA.
UNRWA is essential to providing life-saving aid to people in the region who need it the most, so we should continue to support it.
NDP
Don Davies NDP Vancouver Kingsway, BC
Thank you.
You touched on this in your opening remarks, but I noticed that on June 6 this year, Stephen Brown, the CEO of the National Council of Canadian Muslims, said the following in his testimony before the Standing Committee on Justice and Human Rights:
In the last few months, there has been a drastic rise in Islamophobia and anti-Palestinian racism across Canada. In Q4 of last year, the number of such hate incidents across Canada reported to us increased by 1,300%.
Our communities are experiencing unprecedented levels of hate and violence from every level of society, including but not limited to professionals losing their employment or receiving disciplinary actions after calling for a ceasefire in Gaza, Muslim women with hijabs attacked and harassed in public spaces, children intimidated at school by staff for standing in solidarity for Palestinian human rights, and peaceful protesters labelled as supporters of terrorism.
In your view, what specific measures should the federal government implement to address this rise in Islamophobia and anti-Palestinian racism to protect affected communities and ensure their safety and rights in Canada?
Advocacy Officer, National Council of Canadian Muslims
Mr. Chair, those remarks by our CEO are relevant today, which is why we are recommending that, because of the unabated urgency of Islamophobia in Canada, what we need to see is a rigorous and empirical understanding of how and why Canada is burdened with these kinds of challenges. What we need to see is a dedicated anti-Islamophobia strategy. That strategy, as we mentioned, should include investing in a research hub that can provide scholars an opportunity to work together and collaborate to produce the evidence basis for the kinds of policy changes we need to see to address these concerns, and we need to continue to support an office to combat Islamophobia.
NDP
Don Davies NDP Vancouver Kingsway, BC
B'nai Brith came to this committee and talked about the rising anti-Semitism that I think we're all aware of in this country. We've heard your testimony today and that of Mr. Brown. We're seeing today outbreaks of tension between Sikhs and Hindus in places as diverse as Ontario and British Columbia.
What advice would you give this committee on how to prepare a budget that can allocate funding in an effective way to ensure that we can promote peaceful dialogue and respect for human rights in Canada?
Advocacy Officer, National Council of Canadian Muslims
Mr. Chair, I think what we need to do is invest in the dedicated strategies we need to work together to fight all forms of hate.
Liberal
The Chair Liberal Peter Fonseca
Thank you, MP Davies.
Members, a number of you and some witnesses have spoken to me about timing and some of the commitments you have today. We're going to do one more round and that will conclude today. We'll have this second round and that will be it.
We're starting with MP Dancho.
Conservative
Raquel Dancho Conservative Kildonan—St. Paul, MB
Thank you, Mr. Chair. It's an honour to be here at the finance committee of Canada today. Thank you for having me.
Thank you, witnesses, for your testimony today.
I have a number of questions for Mr. Clayton Campbell. Clayton, thank you for coming to the committee and for your opening testimony.
Mr. Campbell, you are the president of Canada's largest police union, with over 8,000 members. Is that correct?