New beer taxes could sink efforts to create a deal to open Canada’s provincial borders to trade.
Canada’s 13 premiers have one more day to hash out an inter-provincial free trade plan, but a battle over beer could derail the deal.
An Alberta government spokeswoman said that Premier Rachel Notley and her Saskatchewan colleague Brad Wall failed to resolve differences on markups on beer in a private meeting Thursday and instead had to refer the issue to officials.
Quebec Premier Philippe Couillard said a deal could go through without including the always-contentious issue of alcohol, but suggested that would be a poor second choice.
"We want these issues resolved while we are here," he said.
The Alberta government announced last week that they were increasing beer taxes to $1.25/litre. The new tax will apply to all beer, from small craft breweries to large multinational brewers.
The government says the tax will be turned into a grant that will be paid out to Alberta’s small breweries.
Wall says this new tax means smaller breweries from other provinces will have to pull out of Alberta or hike prices and pass the cost on to the consumer.
Notley says the tax changes promote local jobs and economic development.
The premiers are set to conclude their three-day meeting in Whitehorse on Friday, with health care as the major item on the agenda.
The provincial leaders are looking to have Ottawa increase funding to 25 per cent from the current average of 20 per cent. Some premiers were concerned whether new money would come with strings attached.
"We know what to do, what we need is the means to do better," said Couillard. "At some point we'll want to engage them in funding rather than on policy."
Others weren't as worried.
"Money's money, at the end of the day," said B.C. Premier Christy Clark, who said she'd be prepared to consider targeted federal funds for services such as mental health.
Host Premier Darrell Pasloski of Yukon said the premiers agreed that funds for specific health-care goals need to be considered as part of the overall system.
"We need to bring all the discussions together with finance as well," he said. "We need to have a policy discussion and a finance discussion at the same time."
Earlier this week, the provincial and territorial leaders took on everything from carbon pricing to legalizing marijuana to support for Syrian refugees. They also announced their intention to lead a trade mission to Europe and the U.K. some time in 2017.
Asked about recent comments from Prime Minister Justin Trudeau about the need for a national price on carbon, Wall bristled at the fact Trudeau spoke about the issue before a federal-provincial working group had a chance to report on it - although Trudeau said nothing about how that price would implemented.
"If that's to be a legitimate process, why then is the prime minister and the environment minister seemingly precluding the work of the committee?" Wall asked. "With the previous government, there wasn't much talk about working collaboratively so there were no surprises, but, frankly, I'm not sure which is better."
Several premiers said they want quick action from the federal government on the legalization of marijuana to prevent a patchwork of enforcement and distribution across the country.
"I would hope we can develop a national approach, a co-operative approach," said Manitoba Premier Brian Pallister. Clark echoed Pallister's worries around public health, safety and distribution.
The meeting is scheduled to wrap up Friday.
(With files from The Canadian Press)
