Regulations Brewing in Nova Scotia

The Government of Nova Scotia is currently welcoming input about provincial brewing and fermenting operations, colloquially known as “U-vint” and “U-brew.” Following the Nova Scotia Liquor Corporation’s (NLSC) allegations regarding on-site brewing and fermenting, which stoked province-wide debate, the Liberal government promised to introduce regulations that define what is, and is not, permitted.

“U-vint” and “U-brew” stores allow customers to make their own liquor on-site, offering a relatively inexpensive and convenient alternative to at-home kits and, of course, the province’s liquor monopoly. In addition to offering a popular service, for which demand is growing throughout the province, the success of small retailers is creating local jobs and generating economic growth.

Following legislative reforms in 2011, the NSLC pursued court action preventing businesses from allowing customers to use home-brew kits on-site. Last year, however, the agency acquiesced and it is, therefore, important that the provincial government delimit how to regulate this industry to avoid confusion in the future.

Encouragingly, the current Liberal government invited both the public and businesses involved to provide input and it is looking toward other provinces that regulate these operations to gain perspective on how best to govern. There is concern, however, that the government will adopt regulations that tax each litre produced on-site. For example, Prince Edward Island implemented regulations recently that impose similar taxes on U-vint and U-brew businesses, which many small-business owners in Nova Scotia surely fear.

However, an additional tax could dissuade customers and harm U-vint and U-brew business owners. Because the per-litre levy would apply only to incorporated businesses, not individuals, the added cost may very well persuade potential customers that the benefits of at-home brewing exceed the cost of on-site brewing altogether.

In addition to the economic consequences of levying a per-litre tax on small businesses, there are concerns about health and safety. For example, discouraging on-site brew operations provides an incentive for individuals to brew in their home, where safety regulations do not apply.

Nevertheless, the economic rights of, and safety regulations for, U-vint and U-brew businesses must be defined in order for these operations to continue. New laws restricting operations or increasing taxation, however, could harm small retailers that have found a profitable business opportunity that not only increases their own personal wealth, but also provides a service to Atlantic Canadians and creates local jobs and economic growth.

To encourage entrepreneurial spirit, which, when pursued successfully, generates employment opportunities, the government should implement policies that support new industries, as opposed to disfavouring them. This includes forgoing the opportunity to generate revenue by allowing businesses to deliver services to the market at reasonable prices, according to supply and demand, instead of imposing unnecessary restrictions that drive up the cost of production.

Now that public consultation has begun, members of the public have an opportunity to voice their opinions and demand a system that benefits consumers, while also safeguarding conditions that facilitate economic prosperity. There is potential for U-vints, U-brews, and other in-store breweries to expand, as a result, and this is achievable only through recognizing the right to provide services in the most unrestrained manner possible. Nova Scotia’s government is accepting input until 10 February 2014 and, by Spring, will announce what regulations it has settled upon. To voice your opinion or find out more about what the Government of Nova Scotia is saying in regards to U-vint and U-brew regulations, visit: http://www.novascotia.ca/finance/en/home/publications/uvintconsultation.aspx.

Rachel Lowe is a 2013-2014 Atlantic Institute for Market Studies’ Student Fellow. The views expressed are the opinion of the author and not necessarily the Institute

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