![\"\"](\"http:\/\/www.cusjc.ca\/ottawainsight\/wp-content\/uploads\/interprovincial-photo1.jpg\" "\\"interprovincial-photo1\\"")
<\/a>What’s in those trunks coming back to Ontario?<\/span><\/p>\nSo what\u2019s stopping a resident of Ottawa from crossing into Gatineau and buying a case of beer or a bottle of wine? In practice, nothing, but in theory it\u2019s a different story.<\/p>\n
If the price of gasoline isn\u2019t enough, people should be deterred by the fact that bringing alcohol across provincial borders is illegal.<\/p>\n
Yet when a bridge or a line on a map is all that separates you from lower prices or greater selection, it\u2019s a law that\u2019s impossible to enforce.<\/p>\n
The restriction is part of a prohibition-era law, The Importation of Intoxicating Liquors Act of 1928, that gives provinces the authority to manage alcohol by setting up their own liquor boards. Ultimately this law enables provinces to close their borders to the free movement of alcohol.<\/p>\n
If you haven\u2019t heard of this law before, you\u2019re not alone. A 2008 Harris Decima survey found 76 per cent of Canadians were unaware of the law, and 74 per cent, upon learning about the law, thought it was unreasonable.<\/p>\n
With three-quarters of Canadians both unaware and opposed to this law and Ottawa residents able to break it with impunity, how do the LCBO and The Beer Store manage to generate revenue in Ottawa?<\/p>\n
For the LCBO, fighting the lure of interprovincial competition involves selection as much as price.<\/p>\n
In order to compete with Quebec, where some wines and beer can be bought at corner grocery stores, the LCBO helps consumers legally circumvent interprovincial restrictions.<\/p>\n
LCBO Brings In Greater Selection<\/p>\n
LCBO spokesman Chris Layton says the board has responded to an increased demand for out-of-province wine in recent years.<\/p>\n
\u201cWe have more than doubled the number of B.C. wines we carry over the past two years,\u201d says Layton. \u201cWe have also reached out to wine industry trade associations in other wine-producing provinces, and have encouraged producers in other provinces to submit products to us.\u201d<\/p>\n
Layton notes that sales have increased since the LCBO has been stocking its shelves with more out-of-province wines.<\/p>\n
\u201cSales of wines from other Canadian provinces in our fine wine and premium spirits sections were up 60 per cent last year over the previous year,\u201d he says.<\/p>\n
For price comparisons with Quebec, generally speaking I think you will find our wine prices are lower, and we have a lot of Quebec customers shopping in our (Ottawa) stores for that reason<\/p>\n
Consumers can also order wines from other provinces through the board\u2019s private order service \u2013 the only the legal manner in which Ontarians can purchase wine from other provinces.<\/p>\n
\u201cWe can obtain wines from other provinces usually within three weeks from the time the order is placed, says Layton. \u201cThe order can then be sent to the person\u2019s local store anywhere in Ontario for pick up.\u201d<\/p>\n
Still, the cost per bottle is higher than if purchased at the source due to the addition of Ontario levies.<\/p>\n
\u201cYou\u2019re buying the out-of-province bottle of wine at Ontario\u2019s retail price, not the local price,\u201d says Layton. \u201cYou\u2019re paying a price that factors in all the required provincial markups in taxes and levies.\u201d<\/p>\n
Although Layton had no specifics, he believes the fact that LCBO locations in Ottawa are catering to these customer demands means the board has little to worry about in the region.<\/p>\n
\u201cFor price comparisons with Quebec, generally speaking I think you will find our wine prices are lower, and we have a lot of Quebec customers shopping in our (Ottawa) stores for that reason,\u201d he says.<\/p>\n
Overall the restrictions on interprovincial sale and shipment of alcohol have helped the LCBO. In 2009, the board produced a profit for the Ontario government of $1.41 billion, as well as more than $500 million in sales taxes and $346 million in excise taxes and import duties \u2013 its highest-ever totals.<\/p>\n
The Beer Stores Faces Higher Taxes<\/p>\n
The Beer Store, which is privately owned by the Labatt, Molson Coors, and Sleeman brewing companies, also experienced record financial results in 2009. Commodity tax revenue associated with beer sales in Ontario totaled $1.59 billion, of which the province took $1.11 billion and the federal government $471 million.<\/p>\n
Those profits come even as The Beer Store spokesman Jeff Newton admits Ottawa locations often lose business to cheaper prices across the border.<\/p>\n
\u201cTo say we\u2019ve had a noticeable impact, well, that\u2019s right. It\u2019s always been there,\u201d says Newton.<\/p>\n