Overview: The Liquor Control Board of Ontario (LCBO) is an agency of the provincial government and has the primary role over the importing, warehousing, transporting, distribution, setting of prices and retail sale of beverage alcohol in Ontario under the Liquor Control Act. It also monitors prices to ensure the same products are sold at the same price regardless of the retail channel and sets minimum prices for all beverage alcohol. (Although the LCBO establishes the prices for liquor sold to licensees for resale, it does not control the prices that licensees charge in their establishments to patrons.) The LCBO reports to the Minister of Finance.
LCBO Pricing Canadian alcohol products can be more expensive than foreign alcohol products at LCBO. The LCBO's prices are set by its suppliers. The price that is seen in-store is the supplier's price plus fixed taxes and markups. These are illustrated in the attached Pricing . Many suppliers quote in Canadian dollars therefore the price paid to them is unaffected by changes in the exchange rate. It is the supplier and not the LCBO who retains the difference in the exchange rate should they choose not to pass the savings along.
HST: LCBO mark-ups being adjusted The change to the HST resulted in a reduction in the overall retail tax revenues collected by the provincial government, since the provincial portion - eight per cent - is lower than the 12 per cent RST currently charged at retail, and lower than the 10 per cent RST currently charged at bars and licensed restaurants. In November of 2010, the Ontario government released policy objectives which directed the LCBO to take steps to:
- ensure any changes generate no net new revenue to government;
- minimize shifts in revenue from one market segment to another;
- minimize changes to consumer pricing;
- create a structure which continues to promote social responsibility. Consistent with this long-standing policy, the vast majority of beverage alcohol prices will not decrease as a result of HST.
As such, LCBO mark-ups increased to help recover the revenue that would be lost in lowering the current retail sales tax rates on alcohol, and to help maintain a price structure which according to government continues to support socially responsible alcohol consumption.
Limited Time Offers (LTO's) are temporary price reductions on selected beverage alcohol products available at the LCBO. Every four-week sales period, select products are discounted, some by as much as 20% of their regular price. You can use LTO's to buy familiar brands at a lower price or take advantage of LTO's to try new or premium-priced products that at a discounted price.
While the products offered within this program were readily accessible to the consumer the ORHMA has now been able to work with the LCBO to ensure that Limited Time Offers are e-mailed to ORHMA licensed members monthly. Featured offers from the LCBO can be viewed by clicking here. Click on below image or link to view the latest LTO sent out to ORHMA Members.
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