Labatt is walking away from its sponsorship of community events in Halifax, beginning in 2013.

Officials with the beer company say it has been taking heat for its sponsorship of events geared toward families and youth in the city.

"Every year that we sponsor the Alexander Keith’s Natal Day or Christmas Tree Lighting, there's a controversy around it," says Labatt Breweries spokesman Wade Keller.

Health officials say at issue is beer companies sponsoring community events and the impact the sponsorship has on youth.

“First, it causes them to lower the age of when they first have a drink,” says Dr. Gaynor Watson-Creed, the Medical Officer of Health for the Capital District Health Authority and the IWK Health Centre

“Here in Nova Scotia that age is 12.”

Two years ago, Labatt sponsored the Canada Winter Games. Keller says the company paid $100,000, but did not put a logo at the Halifax Oval or the Canada Games Centre because the company knew most of the athletes were under the legal drinking age.

Keller also says just because Labatt is a sponsor does not mean the company is simply peddling beer, but the brewery has heard enough controversy over the years.

As a result, after years of sponsoring the Halifax Christmas Tree Lighting and paying for the naming rights of the Alexander Keith’s Natal Day Festival, Labatt is walking away from both events.

"The city can figure it out,” says Keller. “If you want us to be a part, great. If you don't want us to be a part of it, that's OK too. We will donate our money to other places."

Public reaction on the subject is mixed.

"It's not as if it is going to harm children just because they are paying money to sponsor the event,” says area resident Charlene Davis. “It's the way people misuse it that creates the problem."

"I think it starts early,” says resident Chris Hill. “You're influenced early by what your parents do and what you buy."

Looking ahead, Keller says Labatt could get on board with community events, again in the future, but there would have to be a change first.

"We believe very strongly there should be a sponsorship policy in place in the city," he says.

"There's work that's been done on that,” says Halifax Mayor Mike Savage. “It's ready for council. Sometime in the near future council will have to take a look at that."

Chair of the Natal Day Festival, Tim Rissesco, says he is now scrambling to come up with the $20,000 that was pulled by Labatt.

"We'll have to reassess the program," he says.

Rissesco says the Natal Day Festivities will still take place, but the event could be smaller in 2013.

With files from CTV Atlantic's Paul Hollingsworth