Thank you, Madam Chair, honourable members of the committee and Canadians watching at home.
I want to start with a simple truth that anyone who has ever stepped foot in a taproom already knows: Craft beer isn't just a beverage. It's a community engine. It's a small-town employer. It's a tourism magnet. Occasionally, it's the reason a group of strangers end up debating the merits of socks and sandals at 11 p.m. on a Tuesday night. However, behind that easygoing “pull up a stool” charm is a sector that works incredibly hard—and right now, harder than it should have to.
Across Canada, 1,200 independent craft breweries are facing a challenge that isn't about creativity, quality or consumer demand. It's about a tax framework that hasn't kept pace with the industry it's meant to support. The Excise Tax Act, the backbone of how beer is taxed in this country, still treats craft breweries as though it's 2006, back when flip phones were cool, Western Union was still sending telegrams and the idea of a 500,000-hectolitre independent craft brewery in Canada felt like science fiction. I should add here that a “hectolitre” is just a metric measurement of 100 litres, or two kegs of beer.
Today, the federal definition of “craft” tops out at 75,000 hectolitres. Provinces and the Canadian Craft Brewers Association recognize craft up to 500,000 hectolitres. This gap isn't just a rounding error. It's a steep climb.
Too many breweries hit the top before they hit their stride. To be fair, the federal government has taken meaningful steps. In April 2024 and again in April 2026, craft breweries received a significant excise reduction on their first 15,000 hectolitres of production. That was welcome news. We applauded it then as we applaud it now.
However, here's the catch: More than 60% of all the craft beer in Canada is brewed by breweries producing more than 15,000 hectolitres. These are the regional anchors—the ones hiring dozens of people, investing in equipment, building destination taprooms and drawing tourists into communities that don't always have a lot of tourists. Under that current framework, these breweries receive limited benefit. Their ability to grow is constrained not by ambition or demand but by a tax schedule that punishes success.
Let me put it into perspective. A craft brewery producing 25,000 hectolitres in the United States pays about $200,000 in excise. In Canada it's $445,000. That's more than double and more than half of a brewery's net profits. If you scale that up, at 100,000 hectolitres a U.S. craft brewery would pay $850,000 and a Canadian craft brewery would pay $2.8 million. As a brewery grows, so does the disparity and so does the disadvantage.
Meanwhile, craft breweries here at home are doing everything right. They invest locally. They hire locally. They buy Canadian ingredients. Their cost inputs are three times higher than those of large foreign-owned breweries, yet they still produce 17% of all the beer we enjoy as Canadians while generating 75% of the jobs.
We have 30,000 people working in our sector, 9,000 of them in tourism alone. This sector punches far above its weight. It contributes $1.7 billion to Canada's GDP. It anchors rural communities. It keeps money circulating in Canada rather than flowing out of it. It does all this while navigating U.S. tariffs and global trade pressures that don't exactly make life easier.
What are we asking for? We're asking for something simple, something fair and something modern. We're asking that the Government of Canada adopt a progressive, growth-oriented excise rate schedule that allows breweries to grow to 500,000 hectolitres to help smooth out the climb towards the top excise rate. We're asking for the temporary relief on the first 15,000 hectolitres to be made permanent. We're also asking for a modernization of the rates between 15,000 and 500,000 hectolitres so that scaling breweries—the ones creating jobs, building communities and strengthening domestic manufacturing—can continue to do exactly that.
This isn't a handout; it's a hand-up. It has the potential to be revenue-neutral for the government. An economic impact study that we developed with MNP has shown that every dollar saved goes straight back into equipment, growth and the people of Canada. More importantly, it aligns federal policy with provincial definitions, industry realities and the economic priorities of a government that has said clearly that it wants a stronger, more resilient Canadian economy that works for everyone. Craft breweries are ready to help that economy. We just need a tax framework that helps us grow.
Thank you very much.