The BC liquor tax increase that took effect on April 1, 2026 raised the federal excise duty on spirits, wine, and beer by two percent, and because British Columbia calculates its provincial markup on top of the duty-paid cost, that federal bump pushes wholesale and retail prices up by more than two percent by the time a bottle reaches the shelf. If a drink feels more expensive this year, that is why.
What Changed on April 1, 2026
Ottawa adjusts excise duties on alcohol every April 1 based on the Consumer Price Index, and for 2026 the adjustment came in at two percent.1Liquor Distribution Branch. Annual Excise Duty Rate Changes for 2026, Period 1 Effective April 1, 2026 The mechanism is written into law, so it happens without a new vote each year.2Department of Finance Canada. Supporting Canadian Businesses With Alcohol Excise Duty Relief
The rates now in effect are:
- Spirits above 7% alcohol by volume: $14.117 per litre of absolute alcohol
- Beer above 2.5% alcohol by volume: $37.69 per hectolitre
- Wine above 7% alcohol by volume: $0.745 per litre3Canada Revenue Agency. Excise Duty Rates
The Liquor Distribution Branch updates its wholesale price list to reflect the new duty as of April 1, and stores restock at the higher cost from that point forward. BC’s beer markup rates are also subject to annual CPI adjustments.4BC Liquor Distribution Branch. Wholesale Pricing Changes – Manufacturers Agents Suppliers Presentation Whether the percentage markups on wine, spirits, and refreshment beverages receive identical annual CPI adjustments is less clearly documented in publicly available LDB materials, but those percentage markups still produce larger dollar amounts whenever the underlying duty-paid cost rises.
Why a Two Percent Federal Hike Costs You More Than Two Percent
BC’s pricing formula is layered. The producer’s price gets the federal excise duty added first. The Liquor Distribution Branch then applies its provincial markup to that duty-paid cost. A retailer adds a margin on top of the wholesale price. Then PST and GST land on the final shelf price. Each layer sits on the layer beneath it, so an increase at the bottom gets amplified all the way up.
A two percent excise increase on a bottle of spirits, for instance, is not a two percent shelf-price increase. The provincial markup of 124 percent lifts that new duty amount by more than double, the retailer’s percentage margin lifts it again, and 15 percent in combined sales tax lifts it once more. The end result at the register is a price bump that outpaces the headline federal number.
How Big the Provincial Markup Is by Category
The single largest cost driver in a BC alcohol purchase is usually not the federal excise duty. It is the provincial markup, and how much you pay depends heavily on what you buy.
Spirits
Standard spirits carry a 124 percent markup on the duty-paid cost. For higher-priced bottles, the rate steps down: the first $21.00 per litre of duty-paid cost is marked up at 124 percent, the next $8.20 at 93 percent, the next $8.20 at 62 percent, and anything above $37.40 per litre at 43 percent.5British Columbia Liquor Distribution Branch. Wholesale Pricing Model – An Overview of the Upcoming Changes Mid-range vodkas and whiskies absorb the full 124 percent; premium bottles get a lighter percentage on the portion above the thresholds.
Wine
Wine is marked up at 89 percent on the duty-paid cost. When the duty-paid cost passes $11.75 per litre, everything above that threshold drops to 27 percent.5British Columbia Liquor Distribution Branch. Wholesale Pricing Model – An Overview of the Upcoming Changes A $15 bottle therefore carries a proportionally heavier markup than a $50 bottle.
Refreshment Beverages
Pre-mixed cocktails, hard seltzers, coolers, and ciders sit in the refreshment beverage category at a 73 percent markup.5British Columbia Liquor Distribution Branch. Wholesale Pricing Model – An Overview of the Upcoming Changes
Beer
Beer is taxed per litre rather than by percentage, on a graduated scale tied to brewery size, with the standard rate at the top end sitting at $1.08 per litre.5British Columbia Liquor Distribution Branch. Wholesale Pricing Model – An Overview of the Upcoming Changes
A Bottle of Spirits, Broken Down
Take a 750 mL bottle of gin at 40 percent alcohol. That bottle contains 0.3 litres of absolute alcohol. At the 2026 federal rate of $14.117 per litre of absolute alcohol, the excise duty alone adds roughly $4.24. The LDB’s 124 percent markup then applies to the entire duty-paid cost, meaning it is calculated on both the producer’s price and that $4.24 in federal duty. The retailer’s margin lands on top of the wholesale price, and PST plus GST land on top of that.
By the time you pay at the register, the government markups and taxes embedded in the bottle can easily exceed the cost of the gin itself. The 124 percent markup is the largest single lever, but it is the stacking of all four layers that produces the final number.
Sales Tax at the Register
Alcohol in BC is subject to a 10 percent provincial sales tax, higher than the 7 percent PST on most other goods, and the federal 5 percent GST applies as well. Combined, that is 15 percent in sales tax at checkout. The tax is calculated on a price that already includes the federal excise duty, the provincial markup, and the retailer’s margin, so those 15 points of sales tax cover a base that has already been inflated three times.
Minimum Prices You Cannot Shop Below
BC also sets floor prices below which no retailer can sell alcohol, no matter how cheaply they acquired it. The per-litre minimums (before sales tax) are:
- Spirits: $27.88 per litre
- Liqueurs: $20.39 per litre
- Wine: $6.44 per litre
- Cider and coolers: $3.75 per litre
- Packaged beer: $3.19 per litre
- Draught beer: $1.97 per litre
These floors apply to private liquor stores, wine stores, and manufacturer on-site stores, and BC Liquor Stores voluntarily follow the same rules.6Government of British Columbia. LCRB Policy 16-04 – Minimum Liquor Pricing Deep discounts below those thresholds are not allowed, so a sale you might see in another jurisdiction will not appear on a BC shelf.
When to Expect the Next Increase
Because the federal adjustment is formulaic, a price bump of roughly one to three percent lands every April 1, with the exact figure depending on the previous year’s inflation reading. Years with higher inflation produce steeper jumps. The 2026 increase of two percent reflects moderate inflation, but through the cascade of provincial markup, retail margin, and sales tax, the change you notice on a bottle or a pint tends to feel larger than two percent. Retailers restock at the new wholesale cost through April, and restaurants and bars usually adjust drink prices around the same window.