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The Government of Nunavut (GN) is taking action to modernize our territory’s law governing the possession, sale, and consumption of liquor.
This includes the recent introduction of Bill 56, the proposed Liquor Tax Act. This bill is available to view and download at www.assembly.nu.ca/bills-and-legislation.
Bill 56 proposes to a tax on liquor products sold and consumed in Nunavut. Nunavut is one of the only jurisdictions in Canada that does not currently levy a tax on alcohol, either directly (as Bill 56 proposes) or through a wider sales tax (like an HST or PST).
The proposed tax would be levied on consumers as a percentage of a product’s retail price. Rates would be established through regulation and vary across broad alcohol categories (beer, wine, and spirits).
For alcohol purchased in Nunavut, registered collectors—including the Nunavut Liquor and Cannabis Commission (NULC) and licensed establishments—would apply the tax at the point of purchase, and then report and pay these taxes to the GN Department of Finance on a regular basis.
For alcohol imported into the territory under the import permit process, the tax would be collected on a volumetric basis and applied to the cost of the permit itself. This keeps things simple while at the same time encouraging tax fairness between products purchased in territory and imported products.
The GN is not proposing to tax home brew or liquor that individuals import on their person under the personal import exemption.
We expect Bill 56 to be discussed at the next legislative sitting. Regulations are not expected to be introduced until spring 2021.