Luke Harford, President of Beer Canada, correctly claims that my argument that an inflation adjustment to the federal excise tax on beer is not a ‘tax hike’ rests “on the assumption everyone’s paycheck increases by inflation” (letter, Feb. 5). He asserts that “while this may be true for university professors… it certainly is not true for your average middle-class Canadian.”
Really? According to Statistics Canada, the average wage in Nova Scotia was $12.88 in 1997 and $23.35 in 2017, an increase of 81 per cent over those 20 years. Prices of goods and services rose by 47 per cent over the same period. Annually, wages grew 1 percent faster than inflation.
Mr. Harford claims that 52 per cent of the price of beer in Nova Scotia is tax. I emailed Beer Canada on Jan. 30 asking for details. I am still waiting.
Whatever the true figure, there are good reasons for special taxes on alcohol. As with tobacco, higher prices reduce consumption. I enjoy a pint as much as anyone, but it’s a fact that alcohol remains a leading cause of injury and death, causing more hospital admissions than heart attacks do.
Professor of Economics, University of New Brunswick, Saint John