People walk by an LCBO in Toronto, on March 4.Arlyn McAdorey/The Canadian Press
Bars and restaurants in Ontario can expect to save money on their alcohol bills as the provincial liquor retailer cuts costs for small businesses for the remainder of 2025.
The provincial government announced Thursday that the Liquor Control Board of Ontario will increase the wholesale discount rate for 23,000 small businesses across the province to 15 per cent, up from the current 10-per-cent rate.
The increased discount, which was part of the Ontario budget tabled Thursday, will apply to all wholesale purchases of beer, wine, cider, spirits and ready-to-drink beverages by bars, restaurants, convenience stores and LCBO outlets until the end of 2025. The rate change will amount to about $56-million in total savings for Ontario businesses, the budget said.
The rate break is one of several measures announced in Ontario’s budget that aim to boost alcohol and wine production in the province as the government reviews taxes, markups and fees for microbreweries, cider makers and those who sell premixed alcoholic beverages.
While microbreweries and local wineries cheered the moves, Ontario Liberal Leader Bonnie Crombie said the budget was a “painful reminder” that the government has its priorities wrong: “I’m frustrated watching yet again this Premier care more about alcohol, which is mentioned more than 100 times in the budget, than health care.”
Last September, Premier Doug Ford expanded access for retail sales of beer, wine, cider and premixed alcoholic drinks into thousands of convenience stores and gas stations. Ontario became the third province in Canada, behind Newfoundland and Quebec, to allow alcohol to be sold in corner stores.
“Supporting local has never been more important in the face of U.S. threats,” Greg Taylor, co-founder and chief executive of Steam Whistle Brewing, said in an e-mail to The Globe and Mail.
“Nothing is more local than craft beer and the tax changes outlined will help locally owned craft breweries continue to invest, grow their business, and most importantly take advantage of the expanded retail environment to get more local craft beer on store shelves – making it easier for consumers to support local."
Ontario Craft Breweries president Scott Simmons also applauded the provincial government for “standing up” for the sector and “helping protect the industry in the face of U.S. tariffs.”
Among the tax cuts mentioned in the budget are a 50-per-cent reduction in both the spirits basic tax rate at on-site distillery retail stores and the microbrewer basic tax, while cider beverages will see a 47-per-cent cut to the LCBO markup rate.
The LCBO is also set to end minimum retail prices for all spirits to allow suppliers to have greater flexibility in their pricing.
Ontario’s move to “modernize” the alcohol marketplace has been a “game changer” for convenience stores, said Anne Kothawala, chief executive of the Convenience Industry Council of Canada, an industry association with about 100 members.
“Our stores have seen average sales increase of over 15 per cent, with many of our members, particularly in smaller or rural communities, crediting these reforms for helping them stay competitive and keep their doors open,” Ms. Kothawala said in a statement.
The province’s grape farmers and wineries will see new funding help boost the number of Ontario grapes in bottles of wine.
The Ontario government will provide up to $35-million in annual support for eligible wineries over five years, beginning this year, with total funding of $175-million. The new funding is expected to double the percentage of Ontario grapes in blended wine, leading winemakers to purchase “thousands of additional tonnes” from the province’s grape farmers, the budget said.
“We’ve been struggling the last couple of years so this is great news for us as growers,” Debbie Zimmerman, CEO of Grape Growers of Ontario, said in an interview.
Ms. Zimmerman, who represents more than 500 grape-farm families in the province, said Thursday’s announcement will help spur more investment into the processing of grapes – a step in the production process that has been lagging in Ontario.
“The government has been opening up more point of access and we are really wanting to get more Ontario grapes into wine – and this will certainly get us there,” she said.
In addition, the government is extending the Vintners Quality Alliance wine support program until 2030, adding $420-million in support over five years. The program – which was first set up in 2006 and has been renewed several times since – has also expanded this year to include ice wine, as well as VQA wine sold in convenience stores and on-site winery retail stores.
With reports from Laura Stone and Jeff Gray