Saskatchewan will battle Alberta's appeal on beer tax rebates

The Saskatchewan government says it will vigorously defend Canadian interests in an appeal involving a beer tax in Alberta.

A trade panel ruled earlier this month that Alberta is providing what amount to tax rebates to its small breweries, discriminating against out-of-province beers. The panel gave Alberta six months to change the program, but the province is appealing the decision.

Dustin Duncan, Saskatchewan's acting minister responsible for trade, says the government is disappointed that Alberta has decided to appeal.

The panel decision supports a level playing field for beer, Duncan says, which is good for consumers and the Canadian craft beer industry.

He says the Alberta government "needs to do the right thing and comply with the ruling."

"We certainly applaud the ruling. We think that Alberta is in the wrong and … the ruling does confirm Saskatchewan's position," Duncan said Wednesday.

"I think this is a good day for trade in Canada, but we'll obviously have to see what Alberta's going to do going forward."

The dispute began nearly two years ago when the Alberta government made brewers outside of Saskatchewan, Alberta and British Columbia pay a markup of $1.25 a litre.

Violation of free trade

Opponents argued that was a violation of free trade and Alberta ultimately acquiesced. A year ago, it changed its beer rules again.

This time, it made all beer producers in Alberta and elsewhere pay the same $1.25 a litre. But it also introduced grants to help Alberta producers expand their businesses, in essence returning the markup amount.

Artisan Ales, a Calgary-based importer of beer from places such as Quebec and Europe, filed a complaint with the internal trade panel. Artisan Ales co-owner Mike Tessier said the price changes damaged his business and hurt other distributors.

The Saskatchewan government supported the brewer's complaint as an intervener.

The Alberta government also faces a lawsuit challenging the constitutionality of its beer policies. The court case is set to resume in September.

Toronto-based Steam Whistle Brewing and Saskatoon-based Great Western Brewing Co. say Alberta's beer grants unfairly favour its producers and effectively erect an unconstitutional trade barrier.