Mr. Speaker, it is great to be back in the House for the fall session, and indeed an honour to speak to Bill C-232, an act to amend the Excise Act, 2001 (spirits). I want to thank my colleague, the member for Huron—Bruce, for bringing the bill forward. It is something that he cares deeply about for a number of reasons, and something that I have worked on with him in the past. In the last session, I tabled a private member's bill, Bill C-456, which was also an act to amend the Excise Tax to reduce the tax on ethyl alcohol by $1 per litre. However, the member has brought forward a far more focused bill, one we should all get behind because of what it could do for the spirits industry.
There are only five types of whisky in the world. One of the most popular is our iconic Canadian rye whisky. I am proud to say that the best rye whisky in the world is produced right in my riding, in Gimli, at the Diageo plant. A lot of people do not realize this, but the Diageo plant in Gimli is the largest whisky distillery in Canada and the fifth largest distillery in the world producing whisky.
A lot of us are familiar with Northern Harvest Rye, which is produced at the Crown Royal plant in Gimli. It is now the world champion whisky, having won in Scotland back in January against all the scotches, the bourbons, and Irish whiskys. It is a very popular blended whisky and one that all of us should be proud of. It is unfortunate that the Speaker's whisky is not a Canadian whisky, and it is definitely not Northern Harvest Rye. I would hope that in the future the whisky featured at the House of Commons could be a Canadian rye whisky.
I want to correct the record on something that the member for Winnipeg North said about making sure that the tax treatment is fair and does not impact imports and exports. We know for a fact that this is an equitable tax that would apply to importers and exporters. When we changed the taxation on beers and wines made by local vintners or craft breweries, these producers never experienced any trade retaliation whatsoever. Therefore, the member for Winnipeg North should get up and correct the record, rather than trying to propagate a dissenting opinion based upon erroneous assessments.
The Diageo plant in Gimli, where all the Crown Royal in the world is produced, has some challenges ahead of it. One of those is trying to deal with a rail bridge over which Diageo brings in its grains and exports out its distilled whisky. It is a short line rail. Unfortunately, there needs to be investment made in it to bring it up to safe standards. The short line is looking at some options on how it can do that to continue to service Diageo. Aside from that, Diageo would love to expand the plant because Crown Royal is the number one export whisky from Canada, as well as the number one consumed whisky within Canada. It would love to expand production, but of course this requires long-term investments. One does not just roll out a batch of whisky and put it out into the market. It has to be aged and blended, and Diageo has to make sure it is putting together a high-quality product.
Diageo would love to see that expansion take place, but there is this unfair taxation within Canada today through the excise tax on spirits. This unfairness is the result of our decision a number of years ago, under our previous Conservative government, to give a greater break to wine and beer, so that taxation on undistilled alcohol from those industries is lower than on spirits. We need to close that disparity to see major investments in distilleries across the country and to allow them to serve the market out there.
If we look at the experience we had, we saw a major increase in the number of new entrepreneurial businesses, small businesses, creating local employment and buying locally produced agricultural products, after we changed the excise tax on the craft breweries and the small vintners and the wines they produce.
Bill C-232 would decrease the current excise tax of $11.696 per litre of absolute ethyl alcohol. It would decrease the excise tax on the first 100,000 litres produced down to $6 a litre. That would be a huge saving to those small craft distilleries, allowing more opportunity for Canadian businesses to produce a variety of spirits, not just Canadian rye whisky but others as well, and really have that local context.
If we look at how that went in the brewery and vintner industries, we saw an explosion in the number of of these small businesses, particularly small craft breweries. We also saw an opportunity for us as consumers to do more connoisseuring, I guess we could say, of the different varieties that are out there. There are different blends, there are different flavours, there are different tastes, which we had not been exposed to for a long time in Canada. It provided us with a whole new experience in trying these different fine wines produced locally, these different great craft beers. It would be fantastic if we could have that same explosion happen in the distillery industry.
The one thing we continue to talk about is how this tax reduction on distilleries would create jobs. A case in point is the craft brewery industry itself. Last week, when I was in Halifax, I had an opportunity to go down to Pier 21 and visit Garrison Brewing Company, a small craft brewery that started after the changes happened in the excise tax for the beer industry. It was able to take an idea and grow it into a prosperous business. Nova Scotia alone went from having just a couple of craft breweries to now having over 45. The interesting fact is that if we take our mainstream breweries and the number of jobs they create and compare those with craft breweries, for every job in the mainstream breweries, a craft brewery has five. It is a 5:1 ratio. We are talking about employment opportunities. This is a time in our economy when we need every possible tool the government can give to entrepreneurs and business to create new jobs. We are going to create jobs, not only in building these distilleries but also in the operation of these distilleries, because they tend to be less mechanized and more labour intensive, giving more attention to the details of their distillery practices themselves, as we see in craft breweries and in small vintners.
It is important that we create this opportunity in a lot of our local communities, not just in the major centres that we usually see.
Gimli, of course, is an exception. The reason that Diageo, and before that Seagram's, set up in Gimli was for the water. The water and locally produced grains produce Crown Royal's unique taste.
I talked about the opportunities from the employment side. It also creates a huge opportunity for agricultural producers, as distilleries are a major buyer of Canadian grains. I see it in my riding of Selkirk—Interlake—Eastman, where local producers are growing rye, corn, barley, and other inputs on contract for Diageo to create that unique taste and flavour of Crown Royal. The same type of opportunities will be presented to small distilleries right across this country as they feed into the growing consumer market for unique and new products in the spirits industry.
I encourage all my colleagues in the House to support the bill. Let us get it to committee for study and allow the committee to bring in experts to document how this reduction in the excise tax would probably increase the level of tax revenue coming back to the government, through increased employment and an increased number of businesses, which would benefit from the changes in the Excise Tax Act.
Again, I thank my colleague, the member for the Huron—Bruce, for bringing forward such an important bill today.