Canadian microbreweries are scared of competition.
The proposed consolidation of the world's biggest beer companies in recent weeks has given rise to concerns that it could be harder for Canada's small brewers to sell their brands in your local watering hole.I mean sure, thanks to hipsters and generally more refined tastes in the beer drinking public they have been beneficiaries to a huge boost in sales. But other players in the industry might do things they don't like! The horrors.
"Traditionally, big companies merging to become even bigger companies tends to have a little bit of a chilling effect on innovation and small companies," said Jason Fisher, owner of the Indie Ale House, a Toronto brewhouse that's been in operation for three years.
"You want to go to a sporting event; they own that venue. You want to go to a concert; they own that venue. You want to buy beer at a store; they own those too."
Large brewers use their financial firepower for marketing and sponsorships to increase awareness of their brands. In exchange, those companies can buy up more beer tap lines to dominate distribution in bars and restaurants.
Unfortunately, don't look now, but the biggest chilling effect on microbrewed beer might not be Molson Coors and SABMiller, but the market-distorting effects of evil socialists in government. You don't have to take my word for it, either. Take theirs.
Ontario -based Muskoka Brewery is the latest microbrewery unhappy with new beer taxes in Alberta, saying it will pull its beer from provincial shelves.
The government announced an increase of five per cent, or about 21 cents for a case of beer in its recent budget.
But for small producers outside of Alberta, B.C. or Saskatchewan like Muskoka, that hike combined with revisions to graduated tax rates for small craft brewers can mean significant increases.
Under the previous regime, Muskoka paid a tax rate of 40 cents per litre based on its production; it now faces a rate of $1.25 per litre, or an increase of 212.5 per cent.
"Up until this new legislation was announced, we had no intention of leaving," wrote Garry Mullen, the president and founder of the brewery, in a news release.
"In fact, we had plans to widen our footprint based on the growing demand for our beers. We're sorry to leave our friends and supporters, but with this new tax increase, it's now unsustainable to sell our beer in these provinces."
Muskoka joins Scotland's Innis & Gunn and Toronto's Steam Whistle in condemning the new tax hike. The other two breweries have not threatened to stop shipping to Alberta.