Nanny state: the LCBO knows best (Image: Derek Purdy)
When the HST comes into effect on July 1, dry cleaning and plumber calls will be more expensive, while books and diapers will cost the same. But one of the few items that was expected to drop in price—booze—is actually going up. According to the Star, the price hike is a reality, despite the fact that alcohol taxes are falling from their present 17 per cent to the HST’s 13.
For example, a 750 millilitre bottle of Wolf Blass Yellow Label Cabernet Sauvignon, a popular Australian red wine that currently retails for $16.35, should be dropping in price to $15.80 thanks to the HST.
However, sources say the retail price will jump to $16.45—only a dime more than it is now, but 65 cents higher than it needs to be.
Similarly, the HST should lower the price of a 750 millilitre bottle of Pelee Island VQA Chardonnay, an Ontario white, from $17.95 to $17.35. Instead, it will go up to $18.05. That’s 70 cents in lost savings to wine drinkers.
The LCBO justifies the increase by saying that it has to keep prices high because of its “social responsibility”—in other words, so that Ontarians don’t all become alcoholics when liquor becomes five per cent cheaper.
Who knew that we were that close?
• HST will lower tax on booze, but the price is going up [Toronto Star]
• What’s taxable under the HST and what’s not? [Government of Ontario—PDF]
Time to privatize.
May 13, 2010 at 2:26 pm | by MattagascarWow. So a government-run business (the very government giving us the HST) won’t pass on the tax savings to consumers (the very thing they said the HST will result in) why in hell would a private business.
May 13, 2010 at 3:17 pm | by Adamprivatizing may be the way to go.
May 13, 2010 at 3:32 pm | by wyche1At this rate, I’ll either be shopping now to July 1st at the lcbo, making my own.. or the best idea shopping in Buffalo..
Because Adam, they would have competition.
May 13, 2010 at 4:17 pm | by MattagascarIn 2005 the Finance Minister, Greg Sorbara, commissioned a blue-ribbon Beverage Alcohol System Review Panel to review the LCBO and determine whether it was being managed effectively and efficiently and providing the maximum return to the citizens of Ontario. The conclusion was that Ontario tax payers could net an ADDITIONAL $200M in revenue by privatizing with no corresponding loss in ‘social responsibility’. Upon receiving the report, Mr Sorbara promptly shelved it.
Read it here: http://www.fin.gov.on.ca/en/consultations/basr/report.html
May 13, 2010 at 4:53 pm | by Bryan McCawAs the child of an alcoholic, I want alcohol taxed at a higher rate to help offset the costs to our society — the financial support for departments funded exclusively by our taxes — police, child protection, health care, the courts, and to help support the victims of crime where alcohol is a factor, like drunk driving, assault, and domestic abuse.
May 13, 2010 at 6:05 pm | by Jay DeeLets see. The government run LCBO in the name of social responsibility will increase profitability by raising mark ups to take the place of hidden taxes. It seems at the same time the province will apply HST to the price of gasoline, on top of the already imposed provincial taxes on gasoline. I am no lover of the GST, but at least when it was imposed the Fed’s removed the hidden excise tax. The province wins. The consumer pays.
May 13, 2010 at 6:08 pm | by ScottAs a child who is an alcoholic, and a working one at that, I’m as incensed by the social responsibility as I am by the idea that the difference be spent on departments related to alcohol abuse. I want may nickelback.
May 13, 2010 at 9:24 pm | by DrewSo it’s Ok for the other provinces to drink for cheap but we better watch those from Ontario because 60 cents will make us out of control, WE DON’T NEED A BABY SITTER…I’M TIRED OF THIS GOVERNMENT CONTINUALLY WRAPPING US IN BUBBLE WRAP…ENOUGH!!!
May 18, 2010 at 11:18 am | by bobAlways money. That’s all Ontarians care about. It’s truly pathetic.
May 18, 2010 at 6:37 pm | by FrancoisYes Francois, only caring about money is pathetic, but even more pathetic than that is not knowing how to reason logically, and making obscene generalizations about people you largely don’t know. I don’t give a hoot about the price increases, but this I had to comment on.
May 18, 2010 at 9:46 pm | by M-A-PDon’t just seethe, DO SOMETHING!!!
I am selling my (overpriced) Toronto house and buying a similar property on a lake in Asheville, NY for 1/3 of the price …only a couple of hours away from my doctor and dentist…but light years away from the TTC, the LCBO, Lotto-gate, e-health, the HST and all of the McGuinty run fiasco’s – MORONS!!! did!!!
And, oh…Yellowtail at Tops is only $4.95 a bottle – the price that it was intended to sell at.
Life just got better.
Cheers!
May 19, 2010 at 2:36 pm | by Brian B. Wolfprivatizing is the best way.. are we free market or not????
May 20, 2010 at 10:40 am | by didiHow much the chairman of lcbo makes a year…?????
With the LCBO we have access to a consistent variety of alcohol that yes can be obtained by other ‘corner stores’ however would not necessarily stocked. It has further reach then most companies can afford. Also the LCBO makes the wonderful world of booze openly available for both rural and urban demographics to explore this vast variety with semi-knowledgable staff. However I cannot agree that raising the tax will stop us from becoming alcoholics, however sufficient studies show the tax on tobacco has significantly reduced sales for the average smoker. So this may not eliminate alcoholics, but possibly hinder excess consumption over long periods of time.
May 20, 2010 at 3:29 pm | by JatchuaThis government, and particularly this province, has gone to the dogs. They will continue to apply tarriff after tarriff and tax after tax and law after law and bi-law after bi-law because this government is not interested in the concerns of its people. We are a source of income for its own devices, and a statistic in which we are used to implement these taxes, and laws and so on. A living, breathing cash grab. Money doesnt grow on trees, we are grown to produce money. We are in the 10 highest taxed countries in the world.
May 20, 2010 at 5:49 pm | by Downer DanNothing these idiots do surprises me. Ripping us off at every opportunity and taking your money for human errors. Offering staples of life at a premium price. Found something free? how did they miss that? Dont worry, they got it now.. pay up, son. I can now understand at this age of only 30 why people go live off the grid. Time to start looking for a new home country i think. this ones lost all its appeal.