Ontario Craft Brewers Battle High Taxes: A Closer Look

The Struggles of Local Breweries

The craft beer industry in Ontario is at a crossroads. Well-established craft breweries like Great Lakes Brewery, among others, are finding it increasingly difficult to compete in the burgeoning alcohol market. The culprit? Ontario’s disproportionately high alcohol taxes, which are deemed the highest in Canada by the Ontario Craft Brewers organization.

At this critical juncture, these local breweries are advocating for change. The organization has launched a new campaign, “Save Local Craft Beer”, to highlight the issue and pressure the provincial government to hasten their review of alcohol taxes which started last year. However, this problem extends beyond just craft beer. It also provides a critical cue for our construction and real estate development community.

Alcohol Taxes: Barriers to Expanding Opportunities

As investors and builders, why should we care about alcohol tax reviews in Ontario? The answer is simple. The thriving craft beer industry is more than just an assembly of local breweries; it presents significant opportunities for the construction and real estate development industry.

While craft beer may seem like an unlikely industry to impact real estate development, the connections are more profound than it initially seems. Breweries often occupy large spaces – many of which are reimagined and repurposed warehouses, barns, or factories. These spaces often require extensive remodeling and construction work before they can serve as fully-operational breweries.
Investors and contractors who can understand and cater to the unique requirements of breweries stand to gain, providing much-needed construction and design services. With the right enabling environment and ease of doing business, the industry’s growth could stimulate further real estate developments and property renovations.

However, the current high alcohol taxes hinder this growth by making it increasingly difficult for local breweries to expand, consequently stifering opportunities for property and construction markets.

The Construction Industry’s Role in Craft Brewing

From a property development perspective, Ontario’s craft brewers could provide significant opportunities. The industry’s demand for unique, tailored spaces is a potential boon for developers looking to diversify their portfolios and provide exciting new options for clients.

Newly emerging breweries and existing ones looking to expand require different types of spaces, from retail storefronts to manufacturing areas. These spaces aren’t just limited to brewing; they also include hosting visitors, guided tours, product launches, and other social events often associated with craft beer culture.

For instance, consider how you can turn a large metal building into a fully-functional brewery. Or how a former factory can be repurposed into a modern taproom, each offering its unique set of construction and renovation challenges. The demand is there, and developers and construction companies need to explore these untapped opportunities.

Supporting Craft Brewers: A Crucial Call to Action

In the call to save local craft beer, we must also consider the domino effect of the high beer taxes. Not only are these high taxes a limiting factor preventing the growth of local breweries, but they also inhibit the growth of related industries, such as construction and real estate, in the province.

Given the recent economic and health crises, local industries need all the support they can get. Reducing tax burdens on craft brewers can stimulate industry growth, subsequently translating into jobs for Ontario’s residents, more work for construction and renovation companies, and potentially attractive opportunities for real estate developers and investors.

Conclusion

Ontario’s craft beer industry is a crucial sector that can trigger significant development opportunities. While the current alcohol taxes represent a formidable barrier to the industry’s growth, it’s crucial to review these timely and lift the constraints.

In interpreting the effects of these high taxes, we cannot forget the integral role the construction and real estate industry potentially plays in the growth of craft beer. By repurposing metal buildings and enhancing landscapes with innovative construction solutions, together we can help save local craft beer and build a robust, resilient economy.

This article is based on the news story from CBC. We invite you to share your thoughts, experiences or queries on this topic. With collective efforts, we can make significant changes not only for the craft beer industry but also for the related construction and real estate sectors in Ontario.