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They are saying they want help after a brand new rule took impact to settle a commerce dispute with Australia.
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Printed Dec 01, 2023 • 4 minute learn
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Quebec winegrowers should now remit to the Société des alcools du Québec (SAQ) an quantity equal to 40.3 per cent of the worth of the bottles they promote in grocery shops with a view to settle a commerce dispute with Australia.
Winegrowers and grocery retailer homeowners accuse Quebec, which had promised assist in 2021, of dragging its ft.
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The monetary drain is appreciable for winegrowers who promote their merchandise in grocery shops, mentioned Sébastien Daoust, proprietor of the Les Vignes Des Bacchantes winery, situated in Hemmingford, 50 kilometres south of Montreal.
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Grocery shops signify 40 per cent of its gross sales quantity. “It’s sure that if, in a single day, we eat half of the margins we make, it’ll have a huge effect,” mentioned the entrepreneur who additionally teaches at HEC Montréal.
With this tax, it’s merely unimaginable for a winegrower to make a revenue, provides Fred Tremblay, of Vignoble Camy in St-Bernard-de-Lacolle. In response, his firm merely stopped promoting its wines to grocers and centered on restaurateurs. “You must give 40 per cent of the sale worth to the SAQ. It’s clear that we don’t make 50 per cent revenue on the merchandise we promote. If I give 40 per cent, I’m considerably in deficit.”
The measure was introduced in spring 2021 to resolve a commerce dispute with Australia, which argued native Quebec producers benefited from a aggressive benefit by promoting their bottles immediately in grocery shops.
Quebec “held its floor,” however it had no alternative in giving up in 2021 when the opposite provinces reached an settlement, mentioned the president of the Conseil des vins du Québec (CVQ), Louis Denault. “We knew we have been slightly within the incorrect,” he admitted. “We managed to take care of direct entry to grocery shops, however we agreed to pay a premium.”
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The actual fact stays Vignoble Camy obtains nothing for this fee, Tremblay mentioned. “In return, the SAQ does nothing. They don’t make deliveries. They do completely none of that. Now we have to do the identical work, then unexpectedly, we’ve got 40 per cent much less earnings.”
Practically 31 per cent of bottles of Quebec wine have been offered in grocery shops in 2022, in accordance with the latest report from the CVQ. This proportion has been rising for the reason that observe was licensed in December 2016.
Grocery retailer homeowners are additionally frightened concerning the results the rise may have on their enterprise. As inflation is consuming into family wallets, Pascale Rémond, co-founder of Les Minettes in Laval, doesn’t see how it could be potential to move the invoice on to customers.
“It’s sure that clients will not need to purchase wines with a 40-per-cent enhance on the worth of the bottle,” she mentioned. “With out authorities help, it’s sure there’ll not be any Quebec wine on our cabinets.”
Les Minettes will proceed to promote Quebec wines on the similar worth through the essential vacation interval, as a result of the shop specializing in Quebec meals merchandise stocked up earlier than the Dec. 1 deadline. Within the medium time period, the rise casts a shadow over the way forward for the corporate. “It represents 50 per cent of the shop’s gross sales,” she mentioned.
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Ready for assist
The entrepreneurs interviewed by The Canadian Press are impatient to know if the Legault authorities will assist them take up the blow.
When the rise was introduced in spring 2021, Financial system Minister Pierre Fitzgibbon promised to discover a approach “to restrict the damaging results as a lot as potential.”
Greater than two years have handed since then. Denault had pleaded with the federal government so the phrases of this help have been recognized six months earlier than the rise got here into power.
“We vastly feared what is occurring now,” mentioned the CVQ president, who can also be the proprietor of Vignoble Ste-Pétronille on Île d’Orléans close to Quebec Metropolis. “The federal government’s inefficiency on this matter is atrocious.”
The financial system ministry mentioned it wished to collaborate with the trade to ensure its competitiveness and restrict a possible enhance in costs for customers. “Discussions are persevering with with a view to translate this openness of the federal government into new gestures that may meet the expectations of the neighborhood,” mentioned spokesperson Jean-Pierre d’Auteuil.
Moderately than monetary help, the Canadian Federation of Impartial Enterprise (CFIB) mentioned the rise ought to merely be abolished. If restrictions weren’t imposed on overseas wines, Quebec winegrowers would even be exempt with out contravening worldwide commerce guidelines.
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“We’re excellent in Quebec at placing an excessive amount of tax and, after that, making an attempt to level in different instructions moderately than discovering the basic drawback, which is overtaxation,” mentioned its vice-president for Quebec, François Vincent.
Whereas ready for presidency intervention, Paul Jodin’s firm, from Vignoble St-Gabriel within the Lanaudière area, continues to ship bottles to grocers for the vacation season, however its proprietor desires to proceed with warning. “We’re going to need to ‘break slightly’, as we are saying in French, as a result of we don’t know if there can be compensation. Then, the compensation on the 40 per cent, will they provide us 15 per cent, 20 per cent?
Confusion
Some winegrowers discover communication is poor on the a part of the SAQ and the federal government.
Members of the CVQ obtained data “this week” via their affiliation, which acts as a bridge between the state firm and winegrowers, the SAQ explains.
Particulars on the declarations to be accomplished can be despatched in mid-December. The shape can be “easy” and “full,” assures the spokesperson for the state company, Linda Bouchard. “There’s no curiosity on anybody’s half to make it difficult.”
However some winegrowers who are usually not members of the CVQ discover themselves at nighttime, Rémond mentioned. “On Wednesday once more (two days earlier than the rise got here into power), I spoke to a winegrower who had heard about it, however there was no communication to this impact as a result of he isn’t a member.”
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