HST will reduce taxes by three per cent on alcoholic beverages, but consumers won't pocket much savings due to new Liquor Department Board (LDB) markups.
The LDB claims there will be virtually no changes in price when alcohol is purchased from B.C. Liquor Stores on and after July 1. Once HST is implemented, the 117 per cent markup on wine will rise to 123 per cent.
"If you buy a $20 bottle of wine, there might be $3 of declared tax, but really there's another $10 or $12 in hidden liquor board markup," said Vancouver lawyer, Mark Hicken.
"I'm not convinced that the amount of markup (the government is) charging and they way that they're doing it is entirely correct," Hicken said, "Unfortunately, nobody's ever tested it, and it would be expensive to do that."
Given that, there's a perk for those who purchase B.C. wine directly from a winery because it's not subject to LDB markups. Cynthia Enns, vineyard manager at Laughing Stock Vineyards in Penticton, plans to pass along the three per cent savings to her customers. "It's more of a goodwill gesture that doesn't effect our bottom line, but it helps the consumer," she said.
For more, see The Citizen.
