As shared in a May 6 notice, the 2022 Canadian Federal Budget announced plans to repeal the exemption of the federal excise duty that domestic suppliers receive for their 100 per cent Canadian-manufactured wine, cider, wine coolers, fruit wine and sake – herein referred to as “Impacted Product”. The repeal of the exemption will become effective June 30, 2022.
As per the federal regulation, Impacted Product packaged before June 30, 2022 will not be subject to the excise duty, regardless of whether it is sold after that date.
Impact on BC VQA Rebate Program
The BC Liquor Distribution Branch’s (LDB) May 6 notice stated that it would continue to calculate the BC VQA rebate on the in-bond cost of the wine, which would not include the cost of any excise duty paid by the supplier. The LDB would assume that from July 3, 2022 onward, the supplier price would include excise duty.
However, in recognition of the fact it may take some time for wineries to move through inventory packaged before June 30, 2022 – wine that is therefore exempt from excise duty – the LDB will wait until Period 6, September 4, 2022, before commencing the process to deduct excise duty in calculating the BC VQA rebate.
The LDB will provide updates over the summer on the reporting and calculation process for excise duty that will go into effect for Period 6, starting September 4, 2022.
For any questions on BC VQA rebates, please contact LDB BC VQA Support: BCVQASupport@bcldb.com.
For any questions on price changes, please contact wholesalepricing@bcldb.com.
Thank you for your attention to this matter.