Senate votes to ditch 'escalator tax' on booze from federal budget

The Senate voted on Tuesday, June 20th to ditch a so-called escalator tax on booze from the federal budget, defying Prime Minister Justin Trudeau's insistence that only the elected House of Commons has authority over budgetary matters.

Senators voted 46-to-32 to accept a report from the Senate's national finance committee, which earlier passed a series of amendments aimed at removing a government plan to boost the federal excise tax on beer, wine and spirits automatically by the rate of inflation each year.

A number of senators expressed concern that the automatic yearly tax hikes could devastate many small Canadian breweries and wineries.

The bill now goes to third reading debate today in the Senate, when individual members can propose additional changes, followed by a final vote.

The House of Commons would have to agree to any changes approved by the Senate, something Trudeau has made clear is not in the cards.

The amendments came a day after the Senate narrowly defeated a motion that would have carved out provisions dealing with the creation of a new infrastructure bank into a separate bill.