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Beleaguered bars and restaurants welcome B.C. NDP booze review

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B.C. bars and restaurants are sick of being charged retail prices for liquor and the provincial government appears poised to offer some relief.

Attorney General David Eby has appointed wine industry lawyer Mark Hicken to reach out to the alcohol manufacturing, retail and hospitality industry for ways to support those businesses.

That is music to the ears of industry advocates such as Restaurants Canada that have been vocal in their opposition to a Byzantine liquor branch scheme that offers wholesale prices to private liquor stores but charges higher prices to bars and restaurants.

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The current rules even prevent hospitality businesses from buying booze at private liquor stores, ensuring they can get no relief from the prices set by the B.C. Liquor Distribution Branch, said Mark von Schellwitz, vice-president, Western Canada, for Restaurants Canada.

“Customers — especially visitors from the United States where markups are nowhere near as big — can’t believe the prices we charge for cocktails, but it’s not the bars gouging them,” he said. 

Top-shelf spirits can cost bars and restaurants between $10 and $20 more per bottle, according to prices supplied by the liquor branch.

For example, a private liquor store pays $43 for a 1.75 L bottle of Stolichnaya Premium Vodka while restaurants and bars pay $54. And a private liquor store pays $76 for a 750 mL bottle of Macallan 1824 Scotch Whisky, while a restaurant or bar must pay the $95 retail price. 

The industry fears that people are staying home rather than forking out $12, $15 or $19 for a cocktail, said von Schellwitz.

B.C.’s grade in Restaurants Canada’s Raise the Bar report card released this week slipped from a C+ to a C, largely due to above-wholesale prices paid for liquor by hospitality businesses.

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Alberta earned the country’s highest grade, a B, as the only province with a flat tax and “true wholesale pricing” on all classes of liquor.

The organization is also miffed by a rule imposed by the recently deposed B.C. Liberal government that requires them to buy local wine through the liquor branch rather than direct from wineries, said von Schellwitz.

A report commissioned by the New Democrats while in opposition found that after a flurry of changes to liquor laws and the installation of a new pricing model brought in by the Liberals in 2015, retail prices went up by roughly 11 per cent. 

Liquor sales generated $1.031 billion in revenue to government the following year, up by 10 per cent.

Liberal MLA John Yap, who led the previous government’s review, urged caution when tinkering with alcohol prices.

“That is an important source of revenue and supports a lot of programs, plus there is a public health concern,” said Yap. “The price of alcohol is very closely tied to addiction and over-consumption.”

The report card also takes issue with the federal government’s new “tax escalator,” which will automatically increase the excise tax on beer, wine and spirits each year in line with the inflation rate.

The federal finance department estimates the tax will pull in an additional $470 million over the next five years.

rshore@postmedia.com

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