Kenora MP Eric Melillo says Canada’s hospitality and tourism industry has been devastated by the COVID-19 pandemic, and the last thing restaurant owners need is another tax increase.

Melillo says Canada already has some of the world’s highest taxes on alcohol, and he’s calling for the government to repeal their escalator tax on alcohol sales.

The escalator tax automatically increases taxes on beer, wine and spirits each April without approval from Parliament. It’s scheduled to increase again on April 1, 2021, and was introduced in the federal 2017 budget.

The Canadian Chamber of Commerce is also calling for the escalator tax to be repealed immediately, and their letter of support has been signed by nearly 300 businesses. Melillo has also penned an open letter to Finance Minister Chrystina Freeland over the issue.

Melillo says raising taxes on business owners would be counterproductive at a time when the government should be doing everything possible to help struggling businesses.

“This escalator tax on alcohol is something that the Conservative Party will always oppose. It’s a tax, that with the automatic increase, it doesn’t allow parliament to have the scrutiny over it that we think it should.”

“Especially right now, with many restaurants, breweries and those in the hospitality and tourism sector, struggling to get by as a result of the pandemic, it’s not the time to be raising taxes on these businesses.”

Melillo adds many brewing companies have stepped up to help Canada in their COVID-19 response, and cited the work of the Lake of the Woods Brewing Company who overhauled operations to produce hand sanitizer. They were one of the 300 businesses who signed the chamber’s letter.

In August, Prime Minister Justin Trudeau stated ‘the last thing Canadians need to see is a rise in taxes right now.’

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Alcohol sales revenue should go back into the city, Smith