This enactment amends the Income Tax Act to provide a tax credit for taxpayers who brew, in Canada, not more than 15 000 hectolitres of beer and malt liquor or produce, in Canada, not more than 15 000 hectolitres of wine or spirits in a taxation year.

Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

Small brewery tax credit

127.‍31 There may be deducted from the tax otherwise payable under this Part for a taxation year by a taxpayer who is a licensed brewer under Part III of the Excise Act and who brewed, in Canada, in that year, not more than 15 000 hectolitres of beer and malt liquor

• (a) in the case of a brewer who brewed not more than 5 000 hectolitres of beer and malt liquor, the amount determined by the formula

  A × (0.‍1 × B)

  where

  A

  is the quantity, in hectolitres, of beer and malt liquor brewed in that year, and

  B

  is the duty of excise set out in section 1 of Part II of the schedule to the Excise Act; or

• (b) in the case of a brewer who brewed more than 5 000 hectolitres but not more than 15 000 hectolitres of beer and malt liquor, an amount determined by the formula

  0.‍1 × [1 - (A - 5 000)/10 000] × B × A

  where

  A

  is the quantity, in hectolitres, of beer and malt liquor brewed in that year, and

  B

  is the duty of excise set out in section 1 of Part II of the schedule to the Excise Act.

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Small winery or distillery tax credit

127.‍32 There may be deducted from the tax otherwise payable under this Part for a taxation year by a taxpayer who is a wine licensee or a spirits licensee, as those terms are defined in the Excise Act, 2001, and who produced, in Canada, in that year, not more than 15 000 hectolitres of wine or spirits

• (a) in the case of a licensee who produced not more than 5 000 hectolitres of wine or spirits, the amount determined by the formula

  A × (0.‍1 × B)

  where

  A

  is the quantity, in hectolitres, of wine or spirits produced in that year, and

  B

  is the rate of duty set out in section 1 or 2 of Schedule 4 or in Schedule 6 to the Excise Act, 2001, as the case may be; or

• (b) in the case of a licensee who produced more than 5 000 hectolitres but not more than 15 000 hectolitres of wine or spirits, the amount determined by the formula

  0.‍1 × [1 - (A - 5 000)/10 000] × B × A

  where

  A

  is the quantity, in hectolitres, of wine or spirits produced in that year, and

  B

  is the rate of duty set out in section 1 or 2 of Schedule 4 or in Schedule 6 to the Excise Act, 2001, as the case may be.

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