Alberta beermakers say trouble is brewing

A group of small-scale brewers in Alberta are pressing the province to close beer tax loopholes they say are putting them at a competitive disadvantage.

All small-scale brewers beers sold in Alberta qualify for the same tax breaks, regardless of whether they are produced in province or not.

This makes it difficult for local brewers to compete,says Alley Kat Brewery co-owner Neil Herbst.

"Because of the way the system works [here], it doesnt really make economic sense to set up in Alberta," he said.

"Youre better off to set up in B.C., better off to set up in Quebecand sell into to Alberta because you get the same rate as if you lived here."

But it doesnt go both ways, says Herbst.

Most other provinces have policies in place to encourage the growth of local breweries, says Herbst but no such legislation currently exists in Alberta.

As a result, it actually costs him more if he wants to sell his companys beer outside of the province.

He says hed like to see the playing field levelled.

Thomas Lukaszuk, Albertas minister of Enterprise and Advanced Education, is currently conducting a review of the issue.

He said his priority is to ensure that any changes he might introduce locally does not sour the provinces relations with brewers elsewhere.

"If we are to bring any restrictive measures that will be levied against brewers from outside of Alberta will other governments respond by not letting any of our products onto their shelves?"

Because Albertas brewed beers currently operate within a free market system, Lukaszuk is also concerned whether it is fair to ask taxpayers to help subsidize the beer industry.

Lukaszuk is currently in talks with brewery and provincial representatives from across the country. He expects to complete his review within the next few weeks.