April Fools Day tax increase is no joke

Tax hike on booze makers

Times have undoubtedly been tough for many in Kelowna-Lake Country, but on April 1, it’ll become especially tough for our local breweries, distilleries, cideries and wineries.

That’s because they’ll be hit with the most significant increase in excise tax ever — an estimated 6.3% tax hike.

The source of this hike is simple, since 2017, the federal government has set the excise tax as an automatic escalator tax increase tied to the Consumer Price Index. In practical terms, that means the excise tax increase is tied directly to Canada’s inflation rate.

So, after struggling through record-high inflation in 2022, our local farmers and manufacturers who produce value added products must now face a record-high tax hike in 2023.

Worse yet, as this tax is automatically set, no MP is allowed to vote, whether they agree or disagree, that a hike of this nature is even appropriate given current economic conditions.

Among our G7 partners, Canada already holds the record for some of the highest taxes on alcohol, such as the tax on beer. On average, 46% of the retail price of beer is tax, with no return to the producer. The excise tax hike won’t just hurt local producers but all those who sell our world-class local beer, wine, ciders and spirits. The extra cost will eventually trickle to retailers, licensees such as restaurants, and ultimately consumers.

Our vibrant beverage sector contributes thousands of local agriculture, tourism and hospitality jobs. Margins in these sectors have already been diminished through increases in payroll taxes that kicked in on Jan. 1st, and increases in pretty much all other operating costs, such as transportation and utilities.

A recent report from Restaurants Canada showed more than 50% of licensed restaurants in Canada are losing money or barely breaking even. They calculate this April Fool’s Day excise tax hike will also cost the average restaurant more than $30,000.

The Canadian Federation of Independent Business reported the average small business took on $150,000 in new debt during the pandemic lockdowns and the vast majority of them have not paid this back, nor have sales rebounded to pre-pandemic numbers for all. With higher interest rates increasing their debt servicing costs in addition to other cost increases, this is compressing their cash flow.

For those in the alcohol beverage sector, they will now be hit with this 6.3% tax increase further making it difficult to get ahead of their debt.

It’s for all these reasons that I wrote to the finance minister, Chrystia Freeland, asking for an immediate freeze on the automatic tax increase, saying it is bad for both our local and national economies.

As I stated to the minister, “Producers will be left with the choice of absorbing this cost increase and adding to their debt loads, or passing on this cost to both consumers and our restaurant and hospitality businesses, fuelling inflation more.”

I am still waiting for a reply.

The issue of yearly automatic escalator tax increases was one of the first topics I started advocating against when first elected in 2019 and I have spoken many times in the House of Commons about it.

I will continue to press on this issue so our local breweries, wineries, cideries and distilleries, as well as the greater hospitality sector, won’t have to bear this extra financial burden which will further fuel inflation.

Tracy Gray is the Conservative MP for Kelowna-Lake Country.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

New broadcasting bill raises concern

Regulating online content

One of the pieces of legislation I’ve heard the most about from local residents is Bill C-11 that will change what Canadians will be able to view online.

Bill C-11 is the government's updating of the Broadcasting Act to provide the Canadian Radio-television and Telecommunications Commission (CRTC) the power and authority to regulate online content platforms.

The stated reasoning behind the bill is to bring the CRTC into the 21st Century, while supporting Canadian artists and promoting the spread of Canadian content over that of international competition. While that may seem like a noble goal, there are reasons Canadian artists, legal experts, and digital content producers are speaking out against this bill.

There are profound questions about using CRTC bureaucrats as online regulators. Their mandate primarily is regulating radio, television and advertising. If this bill passes, they would also be tasked with regulating user content-generating websites, like YouTube, where users upload hundreds of thousands of hours of video content every minute.

Even assuming they could do it, the federal government should not be policing what will be defined as "Canadian content" when using social or digital media platforms.

Canadians are right to question an organization having power to censor or impose what content people can see online. A free and open Internet is the gold standard of open democratic nations around the world, all the while also having laws that protect against insinuating violence and hatred. The bottom line is what you can search for and see online will be different than what you will see after the CRTC puts their regulations in place and that will change online algorithms.

Without Bill C-11, Canadian artists are succeeding making their full-time living growing content on digital platforms with the support of fellow Canadians and viewers from around the world receiving billions of views.

Legendary Canadian author Margaret Atwood spoke out against C-11 because, as she put it, "bureaucrats shouldn't tell authors what to write." Canadian social media stars bringing their concerns to the federal government about their content being hidden because of C-11's regulations found themselves ignored.

After spending months studying Bill C-11, Canada's Senate sent back to Parliament a heavily amended version of the (proposed) legislation. The process is the government can decide what amendments it likes and will bring those to the House of Commons for debate.

Canada has already seen a sneak preview of the impacts the government's heavy-handed approach to digital regulation will cause for everyday people. Recently, Google announced that because of another overreaching online law, Bill C-18, it started a test run to temporarily limit access to news content (including Canadian news content) for some Canadian users of Google.

I hope Google will reverse course on this test as no Canadian should be denied the news on a platform they use daily.

The biggest advocates for C-18 to regulate online news content are legacy broadcast organizations who are being outcompeted by small independent media.

Recently, the CBC’s president and CEO stated they are planning to shift services to digital, eventually ceasing traditional TV and radio broadcasting. There are likely many reasons for this, but one could be how Bill C-18 will force media organizations to negotiate with platforms such as Facebook and Google to pay them for posting online content and having it shared.

The biggest winners will be the largest of organizations, further affecting online algorithms pushing their content to the top and putting money in their bank accounts.

If you have any thoughts on these pieces of legislation, please reach out to me as I bring your voice to Ottawa.

Tracy Gray is the Conservative MP for Kelowna-Lake Country.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

MP says it's time to try to 'fix' the bail system

Changing bail rules

Upholding public safety is one of the core responsibilities of serving as a legislator in Parliament.

As your Member of Parliament, I’m always looking at how we can improve our laws and keep our residents safe. Bill C-75 on bail modernization came into effect in 2019, which made it easier to receive bail, and in fact, requires judges to release (previously convicted) offenders at the earliest opportunity instead of keeping them detained. Bill C-5 also removed mandatory minimum sentences for many serious offences.

The government overhauled our justice system through those two bills, and we are now seeing the full suite of their results. Violent random attacks are up and in British Columbia, the same 40 people had 6,000 negative interactions with police in one year.

Conservatives put forth a motion to toughen the country’s bail system and demand the government reform the justice system, which is now seeing violent repeat offenders on our streets. The feeling of our justice system acting as a “revolving door” is shared widely.

Kelowna's RCMP superintendent recently stated, "Being compassionate and concerned about mental health and substance use doesn't mean we have to accept repeat criminal behaviour."

The (government) has tied the hands of our justice system, ensuring repeat offenders have an easier time receiving bail and face less severe sentencing for serious crimes. One recent example of a repeat offender was a public warning that was issued here in the Central Okanagan about a violent, high-risk repeat offender who escaped from a recovery home.

That individual was recaptured, but it was one example of how the current bail system is failing public safety when someone with a history of violence and ignoring court orders was granted bail on weapons charges.

I asked the justice minister about this case in the House of Commons. While the minister said nobody out on bail should threaten Canadians' security, tragically, that has been the case. Five police officers in Canada have recently been killed with some of (those accused) being out on bail. One example was Ontario Provincial Police Const. Greg Pierzchala, who was killed last December by a repeat, violent offender released on bail (accused of) assaulting a police officer and possessing a handgun only months prior.

The calls for action to reform our bail system have now come from every Canadian premier, who jointly wrote to the government. With a 32% increase in violent crime in one year and a 92% increase in gang-related homicides over the last eight years, Parliament should not wait to reform our bail system.

That's why I was proud to second legislation recently introduced in the House of Commons by a Conservative colleague.

Bill C-313 would put a stop to the worst repeat, violent criminals from being released on bail. The proposed legislation targets (previously convicted) offenders who are prohibited from possessing firearms. When such people are charged with a serious gun offence, the hill to climb for bail will be much steeper. In just Toronto, last year, more than half the people charged with gun murders were out on bail at the time of the crime.

That will serve as a first step in reforming our bail system. Most importantly, it places the burden for bail where it should be, on repeat violent offenders to justify why they should be released back into the communities in which they've harmed innocent victims (in the past).

We can still uphold the rights of individuals and the presumption of innocence in our justice system while focusing on repeat offenders and public safety. Bill C-313 and my own Private Members Bill, C-283, "the End the Revolving Door Act," strike that balance of ensuring a justice system that protects the public, upholds victims' rights and provides a path to recovery to those who are faced with addiction.

I hope that members from all parties will join the Conservatives and fast-track these bills into law. People deserve to feel safe in their communities.

Tracy Gray in the Conservative MP for Kelowna-Lake Country.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

Questions surround how much government paid consultants

Big contracts, little service

With Parliament now fully back in session in Ottawa, legislation is being tabled and debated, committees are operating and, as the official Opposition, we are pressing the government on important issues and making recommendations with actions.

One important issue that is surfacing is the large increase in consulting contracts granted by the government.

An analysis by the Globe and Mail reported there was a 41.8% increase in spending on consulting contracts from the 2015-16 fiscal year to the 2020-21 fiscal year. That represents billions of dollars.

One issue that came to light were consulting contracts with McKinsey & Co., which receiving at least $100 million.

McKinsey & Co. is an international consulting firm, offering management advice to companies and governments worldwide with consultancy fees ranging as high as $1,500 an hour.

While previous governments have sought its services, the CBC reported the current government contracted with McKinsey 30 times more often than the previous Conservative government, lead by Stephen Harper.

A department given a large number of contracts was Immigration Refugees and Citizenship Canada (IRCC). A source from within IRCC told CBC, “In the end, we don’t have any idea what they did.”

Conservatives led the charge to work with other opposition parties to call for a Parliamentary committee to investigate these high-priced consulting contracts.

While their work is ongoing, we have to consider what value these types of contracts provide when the federal government employs more than 330,000 public service professionals, including a host of experts in economics, science, communications, management and human resources. Over the eight fiscal years since taking office, the current government has expanded the federal workforce by almost 31%, at the same time as increasing consulting contracts.

Few Canadians would say their experience with services like immigration processing, passport renewals or dealing with Canada Revenue Agency issues has improved over the past eight years. Despite the hard work of public servants, top-down mismanagement and policies of departments resulted in previously unheard of wait lines and wait times.

Recent reporting also found the $54 million ArriveCAN app was created and designed by a two-person company, GCstrategies, that subcontracted to third-party multinational companies. Other organizations said they could have created the app in a weekend for less than $1 million.

Following not far behind questions of responsible fiscal management come a question of ethics. A concerning trend has grown in this government’s handling of outside contracts.

Small Business, Export Promotion and International Trade Minister Mary Ng was recently found in violation of federal ethics laws for a contract she awarded to the public relations firm, Pomp and Circumstance, managed by her close friend Amanda Alvaro.

Diversity, Inclusion and Youth Minister Ahmed Hussen is being forced to answer questions regarding his spending of $93,000 on public relations advice from Munch More Media, a food marketing company staffed by the sister of one of his senior staff members.

Ensuring responsible use of tax dollars is essential. At the same time, there are committed professionals working for the federal government, delivering Canadians the services they need and deserve.

(Conservatives MPs) will ask the tough questions about the excessive increases in consulting contracts and in how ministers are held responsible for the service standards, contracts and operations of their departments.

If you need assistance with programs or have any thoughts to share, feel free to reach out, at 250-470-5075 or at [email protected].

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Tracy Gray, Conservative MP for Kelowna-Lake Country, is her party's critic for Employment, Future Workforce Development and Disability Inclusion

She is a member of the national caucus committee’s credit union caucus, wine caucus, and aviation caucus.

Gray, who has won the RBC Canadian Woman Entrepreneur of the Year Award, and the Kelowna Chamber of Commerce Business Excellence Award, worked for 27 years in the B.C. beverage industry.

She founded and owned Discover Wines VQA Wine Stores, which included the No. 1 wine store in B.C. for 13 years. She has been involved in small businesses in different sectors — financing, importing, oil and gas services and a technology start-up — and is among the “100 New Woman Pioneers in B.C."

Gray was a Kelowna city councillor for the 2014 term, sat on the Passenger Transportation Board from 2010-2012 and was elected to the board of Prospera Credit Union for 10 years.

In addition, she served on the boards of the Okanagan Film Commission, Clubhouse Childcare Society, Kelowna Chamber of Commerce, Okanagan Regional Library and was chairwoman of the Okanagan Basin Water Board.

She volunteers extensively in the community and welcomes connecting with residents.

She can be reached at 250-470-5075, and [email protected]


The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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