It may be time to mix a little water with the wine. Although the HST reduces sales tax on alcoholic beverages, consumers won't pocket much savings.
Currently, there's 10 per cent PST and five per cent GST for a combined total of 15 per cent tax applied to liquor sales. Three per cent of that tax disappears when the 12 per cent HST is introduced, but these savings are offset because the the Liquor Department Board (LDB), is marking up the price of booze. 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.
"We expect consumers will only see a difference of plus or minus a few pennies, depending on the product," LDB communications manager, Tarina Palmer said in an e-mail.
Still, the markups are a concern for wine enthusiasts because wine is already marked up a significant amount. Once HST is implemented, the 117 per cent markup will rise to 123 per cent.
For more, see The Citizen.
