Brewers say new NSLC policy could set 'dangerous precedent' in Canadian beer market
New policy means Labatt Breweries qualifies for an incentive that makes them eligible for $750,000
Brewers across Nova Scotia are expressing frustration and confusion over a recent policy change that benefits a multi-national brewer located in Halifax's north end.
The Nova Scotia Liquor Corporation made a change in policy that they say will help level the playing field for commercial and craft brewers.
Small local producers do not see it that way.
This new policy means Labatt Breweries qualifies for an incentive that makes them eligible for $750,000.
Labatt is part of Anheuser-Busch InBev, which operates the Oland Brewery and Alexander Keith's. The business publication huddle.today first reported the story.
Jeremy White with Big Spruce Brewing says the policy change helps the province's largest brewer, while smaller operations are struggling in the midst of a pandemic.
"$750,000 worth of help to the biggest brewer in Nova Scotia at such a time was frankly shocking," he said.
White said large producers like Anheuser-Busch own a large portion of the retail space in the NSLC.
On April 1, the Nova Scotia Liquor Corporation made it so big commercial breweries are now eligible for a reduced markup for the first 15,000 hectolitres of beer produced.
Previously, only craft and nano brewers were eligible for this taxable benefit.
White said local producers have been asking for an increase in the hectolitre cap, but instead discovered that Labatt was going to benefit from the change in the policy.
'A cheque to a multinational company'
Brian Titus, vice-president of the Craft Brewers Association Nova Scotia, says the policy change directly helps one company.
"Labatt is great people and they make a beer that has history here, but it's a multinational corporation. They're not founded here," he said. "The money doesn't stay here and so really that's a cheque to a multinational company that just leaves the province."
A letter sent to the NSLC by the brewers association states the policy change is "unprecedented in Canada"
The letter, signed by association president Emily Tipton, highlights that other provinces keep local craft breweries distinct from multinationals, adding the changes made by the NSLC "sets a dangerous precedent" that could be exploited by Anheuser-Busch InBev.
NLSC says change puts 'everyone on a level playing field'
The NSLC's Dave DiPersio says changes were made to help commercial beer makers.
"The intent was to put everyone on a level playing field and we didn't want the definition of craft [versus] commercial to determine eligibility for these markups," DiPersio said. "We thought it was actually a bit unfair the way it was previously written."
"This doesn't level any playing field at all," he said. "It takes away something that makes us special and unique, which is that we invest and produce locally and now that doesn't really mean a lot."
DiPersio says the policy change was made without representatives from the craft beer industry at the table, which he says in hindsight was a poor decision.
Both White and Titus hope to meet with the NSLC soon to ensure better policy changes that impact the entire industry moving forward.
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