Clock ticking for reforms to B.C. spirits regulations, industry says
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British Columbia’s craft distilling industry is renewing its plea for major liquor reforms, but says time is running out to get those changes on the books.
Tyler Dyck, president of the Craft Distillers Guild of B.C., said the industry has been talking with Agriculture Minister Lana Popham, and is confident she understands the industry’s two key priorities.
Those boil down to a heftier share of sales at the till in government liquor stores, and an end to cash penalties that punish distillers who exceed an annual production cap.
Dyck said those changes could kick-start a renaissance in the B.C. spirits industry, which would stimulate local agriculture while providing more tax revenue to the province.
“Quite frankly, 99 per cent of all spirits are sold at a government liquor store have nothing to do with B.C.. They have zero impact to B.C.’s economy,” he said.
“The B.C. government, David Eby pulled U.S. liquor from all government liquor stores. We have empty shelf space in there. The government’s losing tens of thousands of dollars every day in revenue that could be used to build highways, build schools, build hospitals.”
To be certified as “craft,” a distillery in B.C. must use 100-per cent B.C. inputs, ferment and distill on site, and not exceed annual production of 100,000 litres.
The industry has boomed in the last two decades, growing from just four distilleries to nearly 10 times that number.
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But Dyck said that growth has flatlined as producers struggle with the hefty markup the province applies to craft spirits sold at government liquor stores, which amount to 7o per cent of the sale price.
Most distillers would have to price the item so high it didn’t move, or sell it at a loss under that scenario, he said.
The industry wants to see the province emulate the Vintners Quality Alliance (VQA) program it has for B.C. winemakers, who only face a 17 per cent markup if they use 100 per cent B.C. grapes.
“They were given these privileges 30 years ago and they went from an industry that was worth. Couple hundred thousand dollars to the B.C. economy to now over four billion dollars. Thousands of jobs, agricultural, it’s a gem,” he said.
“What we’re saying is just treat us fairly. Give us the same benefits that our colleagues have dined out and powered the economy for over three decades and we will mirror them and do the same.”
The industry’s other major bone of contention is the 100,000-litre production cap.
With interest in local product surging amid U.S. threats and the “buy Canadian” movement, Dyck said some distillers are likely to hit that marker, and soon — but instead of being celebrated for success, they stand to take a hefty financial hit.
“They have only two choices then: they can either defy the cap and just keep selling, and then they’ll be fined $280,000 to $300,000 for that … or they shut down,” Dyck said.
“So this is a moment in time that is extremely time-sensitive.”
The guild was slated to meet with Popham on Monday, but that meeting was postponed with a pledge to keep working on the issue of the next several weeks.
Popham was not available for an interview on Monday, but in a statement said ““I look forward to meeting with the Craft Distillers in the coming weeks to drill down on the changes they want to see.”
“I am actively working with the sector to help them grow and strengthen their businesses.”
Dyck said he believes that work will happen in good faith, but that the clock is ticking.
“Some of these distillers will have to be making decisions — do they shut their doors or do they defy a production cap?” he said.
“No one wants to see that.”
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