Alcohol prices could rise in Ontario

Liquor costs for this May long weekend may take a bigger chunk out of some wallets than expected, as an official release from Spirits Canada has revealed that a lack of alcohol inventory and a tandem price increase is looming around the corner for Ontario. 

The organization — which functions as a mouthpiece for brands in Canada — has revealed that due to a lack of progress in negotiations surrounding the LCBO’s new tax bill, brands representing 70 per cent of liquor sales in Ontario are gearing up to make major adjustments to cost and availability. 

“As the sole buyer and seller of all beverage alcohol for Ontario consumers, the LCBO’s conflicting policies are overcharging both suppliers and consumers again and again. This could drive some of the consumers’ favourite brands out of the market,” said Lorena Patterson, Senior VP for Public Affairs and Policy with Spirits Canada in an official statement. 

These disputes mainly surround Ontario’s approach to liquor pricing, as according to Spirits Canada, provincial alcohol sales have been operating on a price scale that has been increasing annually. Additional information also indicates that this price markup shot up by five per cent this past year alone. 

According to an official statement, this behavior has isolated many wholesale distributors from operating in the province, as the cost disparity between Ontario and other provinces continues to widen. For example, as indicated by information provided by Spirits Canada, the lowest-cost bottle of vodka in Ontario is around $30, while the same bottle in Quebec sits at around $20. 

“This retroactive tax grab ignores our long history of collaboration and investment in the province, and the major impacts that all Ontario and other Canadian consumers could now face,” said Patterson in an official statement. 

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Brands that are at risk of being impacted by this trend include: 

• Bacardi Canada Inc.
• Beam Canada Inc.
• Brown-Forman Corporation
• Corby Spirit and Wine Limited
• Diageo Canada Inc. 
• Forty Creek Distillery Ltd. 
• Rémy Cointreau 

According to Spirits Canada, LCBO officials have provided very little in the way of a remedy for these inconsistencies. Beyond the lack of a communication throughline, Spirits Canada has also indicated that many brands are reconsidering their operations as a result, or as Patterson put it in an official statement, “Our companies are compelled to examine all possible options for action.”