Shannon Terrell
Beth Buczynski 
In the wake of some of the highest rates of inflation in decades, Canadians can add liquor to the list of things that’ll cost more in 2023.
There are ways to cut costs without going dry — though you may need to get strategic about how and where you spend money on alcohol.
Tax on liquor will rise by 6.3% in April
On April 1, 2023, liquor in Canada will cost 6.3% more thanks to an alcohol tax hike implemented by the federal government. The increase is a result of an annual escalator excise tax implemented in 2017. The escalator tax allows the federal government to automatically raise taxes on alcohol in response to inflation.
Speaking of which: Canada’s inflation rate hit a 39-year high in June 2022, and hasn’t receded much since. The elevated cost of goods and services across the country continues to put pressure on consumer finances. And this alcohol tax bump means trips to the liquor store are about to become more expensive.
Tax will add over $50 to annual alcohol bills
Canadians of legal drinking age spent an average of $837 on alcohol from April 2020 to March 2021, according to Statistics Canada. Based on this data, the average Canadian can expect to pay an extra $52.73 annually on liquor once the new alcohol tax hike is in place.
3 ways to cut costs and buy booze on a budget
Despite alcohol tax hikes and high inflation, there are ways to save money on spirits — though you may need to get creative.
If you think crossing a provincial border is the answer, think again. Alcohol taxes vary by province, with flat-rate and percentage-based markups that fluctuate by liquor type, volume and more. This makes it challenging to identify how much more or less you may pay to purchase liquor outside your home province.
Instead, look to lower-shelf liquors, duty-free discounts and drink specials at bars and restaurants to cut down on alcohol costs.
1. Skip the premium liquors
Production method, age, and location often play a big role in how alcohol is priced. Vintage wines tend to be more expensive than younger wines. You’ll pay more for craft or imported beer than you will for domestic drafts. Spirits also range in price, and unless you plan to savour it straight, skip the premium stuff and opt for a less expensive bottle.
2. Buy from a duty-free shop
Duty-free stores sell products — alcohol, jewellery, tobacco products, perfume, and other souvenirs — without added import, sales, value-added (VAT) and local taxes. The opportunity for savings at a duty-free shop is significant, especially when purchasing heavily-taxed goods, like alcohol.
For evidence, look no further than the price differences between the government-owned and operated Liquor Control Board of Ontario and the Duty-Free shop located in Fort Erie, Ontario.
| LCBO | Peace Bridge Fort Erie Duty-Free | |
|---|---|---|
| Dillon's Unfiltered 22 Gin (750 ml) | $41.95 | $32.95 |
| Absolut Vodka (1L) | $31.45 | $21.95 |
| Remy Martin Cognac (1L) | $111.45 | $99.95 |
| Trius Brut (750 ml) | $29.95 | $24.95 |
Duty-free stores are often found at international land borders and airports, so opportunities to take advantage of tax-free savings may be few and far between. But the next time you take an international trip, budget some time to browse the duty-free wares for potentially big savings.
3. Scout for drink specials when dining out
Expect to pay more for alcoholic beverages when dining out. In fact, you may find yourself paying double (or more) for a bottle of wine at a restaurant — at least in Ontario. If you’d like to enjoy a drink or two while out on the town, look for happy hour specials and the like. Some restaurants have discounted daily drink features, half-priced bottles of wine or two-for-one cocktails, depending on the time of day or day of the week. Taking advantage of these deals may require some planning, but the savings could be well worth the effort.
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