Rich Coleman, B.C.’s minister responsible for liquor policy, is expected to announce a new tax policy on Thursday for the province’s breweries, heading off the threatened shutdown of Prince George’s Pacific Western Brewing Co.
The policy is to be announced a week after the Liquor Distribrution Branch informed industry stakeholders of an amendment that gave Pacific Western a signficant tax break – one that Mr. Coleman says was made in error. The backtracking came after The Globe and Mail learned that the brewery recently made an in-kind donation of nearly $27,000 to a fundraiser for Mr. Coleman.
B.C. New Democrats are urging the provincial Liberal government to delay any taxation changes that could yield millions of dollars in benefits to the brewery, which is owned by a Liberal supporter, Kazuko Komatsu.
Maurine Karagianis, liquor distribution critic for the opposition NDP, said Wednesday the plan looks like “one-off” policymaking by a government attempting to reverse its declining political fortunes as it tries for a fourth term in the May, 2013, provincial election.
“I would say let’s hit the pause button on this until [Mr. Coleman] has had time to consult with the industry and ensure they are onside,” Ms. Karagianis said. “It’s an apparent conflict of interest when it looks like a minister of the Crown is doing favours for his cronies,” she said of Mr. Coleman. “That doesn’t serve the industry well.”
At issue is the mark-up breweries pay the province for the beer they produce. Pacific Western Brewing Co. had threatened to close its doors on Friday unless it got cha nges that would allow it to expand its production, but a spokesman for the company said Wednesday that shutdown won’t happen.
Ms. Komatsu, the brewery’s owner, donated two one-week stays at a resort in the Bahamas valued at $26,600 as auction items for a fundraiser held in Mr. Coleman’s riding of Fort Langley-Aldergrove on Nov. 8. Mr. Coleman said the auction items fetched little cash.
The new rules – amendments to the province’s mark-up policies announced Nov. 14 – would allow a company like Pacific Western to make inroads into the market share of the province’s larger breweries, which are taxed at a higher rate.
In B.C., most of the breweries are either small, cottage entities or big, national brands such as Molson and Labatt.