A recent study from the Canadian Centre on Substance Use and Addiction (CCSA) has revealed a stark reality for Canadians: the cost of alcohol consumption far outweighs the revenue generated from its sales. In 2020, the Canadian government collected $13 billion from alcohol sales but incurred a staggering $19 billion in social costs related to alcohol use. This results in a net deficit of $6 billion, highlighting the significant burden that alcohol-related issues place on Canadian society.
The social costs of alcohol consumption encompass a wide range of areas, including healthcare expenses, lost productivity at work, and criminal justice expenditures. Adam Sherk, senior scientist and special policy advisor with the CCSA, elaborates: “Some of the costs are deaths, hospitalization, addictions, treatment, long-term disability, short-term disability, absenteeism, and presentism when people are at work but their capacity is reduced.”
Sherk’s research, which analyzed data from 2007 to 2020, shows a disturbing trend: the alcohol deficit has more than doubled during this period. He emphasizes the importance of price adjustments as the most effective way to influence consumer purchasing patterns around alcohol.
In response to these findings, the federal government raised its alcohol excise tax by 2% on April 1, 2023. However, Sherk contends that this increase, which was intended to keep pace with inflation, was effectively a 2.7% real decrease in tax revenue due to inflation. He views this as a corporate subsidy for bars and restaurants and argues that it sends the wrong message about the health and well-being of Canadians.
Calgarian Earl Thiessen, who has overcome alcohol addiction, shares his perspective on the societal impact of alcohol: “The strain on the system economically, divorce, treatment centres, psychologists, hospitals. I must have been in the hospital about 50 times.” He refers to alcohol as “slow suicide” due to its gradual and devastating effects on health.
Sherk’s research reveals that the federal alcohol excise tax has been on a steady decline since the 1990s, making alcohol increasingly affordable compared to other goods and services. He advocates for maintaining the price of alcohol at least at the level of inflation to mitigate its harmful effects.
While the Alberta government has no immediate plans to increase the alcohol tax, Health Canada acknowledges the significant public health and safety concerns associated with alcohol use and emphasizes its commitment to addressing these issues through various initiatives, including research, public awareness, and monitoring of alcohol consumption trends.
