Artisan wineries want Ontario to drop extra restaurant fees for non-VQA bottles

A group of small Ontario wineries saysa levyfor selling non-VQAbottles to local restaurants goes against the Ford government's "open for business" mantra and iscalling on the province to place their 100 per cent Ontario grape wines on equal footing with VQAones.

While artisan wineries can holdtastings or sell bottles at their farm stores, once that bottle gets into the hands of a restaurant they're charged an extra28 per centabove what a VQA Ontario winery would pay.

"If you sold that $20 bottle of wine in a case ...the VQA winery is going to receive $173.64 inrevenue and we're going to receive$113.40," said Craig MacMillan, co-owner of Stonehouse Vineyard in North Glengarry, Ont.

MacMillan is theinterim chair ofOntario Artisan Wineries, which represents farmers selling fewer than 2,000 cases per year and is mostly made up of vineyards in eastern Ontario.

That $60 difference may not seem like much, MacMillan said, butwhenlooking at multiple cases, those numbers add up quickly.

If an artisan winery chose to sell all 2,000 casesto local restaurants, they would pay $120,000 more in taxes than a VQA winery, he said.

"Legally are we allowed to sell to local restaurants? Absolutely. But you can't when you're paying those types of charges," he said.

VQA, short forVintners Quality Alliance,is a program fromthe Ontario Wine Appellation Authority that sets standards for wine made in the province.

The VQA markon a bottle indicates the wine is made entirely from grapes grown in Ontario thathave also been approved through a quality assurance program.

MacMillan said it doesn't make sense to have a different policy for artisan wineries that also use 100 per cent Ontario grapes.

We work too hard to give our wines away for barely anything, so it doesn't make financial sense for us to go that route.- Jan-Daniel Etter, owner of Vignoble Clos du Vully

The onlydifference isthe type of grape many of his group's members use, asmostVQA Ontario-approved grapevarieties can't be grown outside southern Ontario and Prince Edward County.

In 2019, the province did add hardierMarquette grapes to the VQA Ontario's approved list, but other varieties haven't made the cut.

Jan-Daniel Etter sees selling local wines to local restaurants as a natural next step for his Navan wineryVignoble Closdu Vully,about 35 kilometres southeast of downtown Ottawa.

"[Restaurants are]showcasing the best of what's being grown and produced in the area and the wine is part of that culture,so I think it would be a perfect complement," he said.

Thetax structure isprohibitive, Etter added.

"We work too hard to give our wines away for barely anything, so it doesn't make financial sense for us to go that route," he said.

Eastern Ontario municipalities call for markup removal

MacMillan andOntario Artisan Wineries have been lobbying local municipalities to support their call for a review of what he calls an unsustainablemarkup and wine levy.

Last Wednesday, the City of Ottawa passed a resolutionsupportingthe elimination of theseextra fees and calling on the province to remove them.

Orlans South-Navan Coun. Catherine Kitts believes it's time for the legacy legislation to be revisited.

"Wineries are a really big contributor to our local agri-tourism sector," she told CBC, admitting even she couldn't get a clear answer from the province as to why the tax discrepancy exists.

Several other municipalities in eastern Ontario have supported similar motions in the past weeks.

In a statement, Ontario Ministry of Finance spokesperson Scott Blodgett said the wine sector is"animportant part of our province's economy" and the government is "committed to seeing it grow and thrive."

Blodgett also wrote that wineries have access to a range of government supports, although he did not specify them.

"The government will continue to work with our industry partners and ensure there are more opportunities for businesses," he wrote.