Ontario Craft Wineries has Prince Edward County council’s support in requesting lower taxes from the provincial government.
At Tuesday’s Prince Edward County council meeting, representatives of OCW and the Prince Edward County Winegrowers Association asked for support in requesting the abolition of a 6.1% basic wine tax and a rebate on a 35% import tax.
OCW president Richard Linley cited the damage the COVID-19 pandemic has done to small and medium sized wineries as well as the unfairness of an import tax on Ontario-grown wine as reasons they’re pushing the government to act.
Linley explained how these taxes hurt small and medium sized wineries.
“Basic wine tax of 6.1% is a punitive tax measure imposed on wineries that sell their own wine from their cellar doors. This is highlighted by the average amount paid in the yellow section below. No other retail product or small business in the province pays this type of tax.”
Linley noted that Ontario’s grape and wine industry generates $4.4 billion in total economic impact, $522 million in tax revenues to the province and attracts 2.4 million visitors annually to the county.
He also listed several financial effects the COVID-19 pandemic has had on Ontario wineries including a decrease in sales revenue, the loss of event hosting, slowing export sales, employee layoffs and a slowing demand for product from restaurants.
“Our restaurant partners have also been negatively impacted by the pandemic. For example, we know that eight out of 10 restaurants are losing money or barely surviving. This has downstream impacts on wineries. Restaurants are our wineries’ second-highest margin channel outside cellar door and accounted for over $70 million in annual VQA sales prior to the pandemic.”
With the combined effects of lost revenues from the COVID-19 pandemic Linley said these taxes make it hard for small and medium wineries to sustain business.
County councillors were quick to throw their support behind it due to the large impact that wineries have on the county’s economy.
Council moved to write a letter of support to Premier Doug Ford, MPP Todd Smith, the minister of agriculture, the minister of finance and the president of the treasury board.
See the full report from OCW here.
