The e-mail below, reproduced by permission of the author, brings to light an important battle that the Ontario wine industry is facing. Given the fact that our industry here is young but very focused on quality, I wholeheartedly support the petition's aims.
From: Caroline Cellars
Sent: Friday, March 09, 2007 3:30 PM
Subject: Please support the Ontario and Canadian Wine Industry
Hi everyone,
I am forwarding this letter to all of you because it is an issue very near
and dear to the Ontario and Canadian Wine Industry, and as a member of
Caroline Cellars' mailing list, I take you to be a supporter of the Ontario
wine industry. For those of you who have heard, the European Union (EU) has
challenged our Federal Government's decision to provide Excise Duty Relief
to Canadian wineries' products made with 100% Canadian fruit (grapes and
otherwise).
Excise Duty is "hidden", meaning it is not seen directly by the consumer,
but is payable by the producer of the product. The cost is $0.62 per litre
payable by the producer. In the spring of 2006, our Federal Government
provided excise duty relief to all 100% Canadian-made wines bottled after
July 1, 2006. This relief amounts to approximately $10 million, which is a
significant amount to the Canadian industry, but a small amount when you
consider the amount of subsidies being afforded to wineries within the EU.
The Canadian Vintners Association which is the national association
representing wineries across Canada has launched a petition to in support of
the Canadian wine industry in light of a recent threat of
trade action by the European Union that could place domestic jobs at risk.
European wineries - who enjoy $US 2 billion in subsidies - currently
dominate the Canadian wine market with approximately 50 percent market
share. European countries like France have even greater penetration in
their own countries with close to 90 percent market share.
Canadian wines represent a 29 percent market share in provincial liquor
stores and less than 1 percent in France.
Despite their dominance in our market, the EU is threatening legal action to
protest a small excise tax measure introduced by the Canadian Federal
Government to level the playing field. The measure only assists wines made
with 100 percent Canadian grapes (VQA) and applies to a mere five percent of
Canadian producers' sales.
Most wine producing countries do not charge an excise tax. Those that do,
such as the US and Australia provide their producers a credit or rebate
similar to the exemption provided to Canadian producers. The EU is not
protesting the US and Australia excise measures.
Canadian wineries contribute $4.29 in economic benefits to Canada for every
litre of wine produced compared to $0.56 per bottle of imported wine. In
addition, wine tourism currently draws 1.5 million tourists and $500 million
into regional economies, which is at risk by the EU challenge.
It is important for Canadians to support our industry and the jobs they
create.
Please visit www.supportcanadianwines.com to sign the petition. Please also
pass this message on to anyone who you feel may support this effort.
Justine Lakeit
Retail Manager/Events Coordinator
Caroline Cellars Winery
1028 Line 2, PO Box 358
Virgil, ON L0S 1T0
T: 905.468.8814
F: 905.468.4042
carolinecellars@sympatico.ca
http://www.carolinecellars.com