Ontarians could see higher prices for beer, wine, and spirits starting Jan. 1, as changes to the province’s alcohol marketplace take effect—potentially making a night out at the bar more expensive.
Beginning in the new year, the Liquor Control Board of Ontario (LCBO) will become Ontario’s sole wholesaler of alcohol. At the same time, a temporary wholesale discount provided to licensed establishments will be scaled back.
Restaurant discount reduced
Restaurants and bars currently receive a 15 per cent licensee discount when purchasing alcohol from the LCBO. That temporary increase—introduced earlier this year amid trade pressures with the United States—will revert to the standard 10 per cent discount on Jan. 1.
Kris Barnier, vice-president for central Canada and the north at Restaurants Canada, said the change could raise costs for licensed establishments. However, industry advocacy has led the LCBO to delay additional pricing and service changes until at least April 1, 2026.
“Our efforts prevented a pricing model shift that suppliers warned would significantly increase costs for licensees and consumers,” Barnier said, adding that delivery and pickup services will continue through December to give businesses more time to adapt.
Why prices could rise
The revised discount is part of broader reforms tied to Premier Doug Ford’s plan to expand alcohol sales in convenience and grocery stores. The LCBO has said its new wholesale formula will create uniform pricing across retailers, including grocery stores, convenience stores, The Beer Store, and LCBO outlets.
Restaurant groups warn that many establishments operate on thin margins. Restaurants Canada president and CEO Kelly Higginson told The Canadian Press that 41 per cent of restaurants are unprofitable and may have little choice but to pass higher costs on to customers.
“We’ve seen double-digit inflation in food, insurance, and commercial rent,” Higginson said, noting many restaurants have not raised menu prices in line with rising expenses.
Corner stores and groceries also affected
Convenience stores may also face higher wholesale costs. Anne Kothawala, president and CEO of the Convenience Industry Council of Canada, said a new LCBO pricing formula—adding taxes, markups, and fees to supplier-set prices—could push retail prices higher for some sellers.
Industry associations wrote to Ontario Finance Minister Peter Bethlenfalvy last fall, urging the province to delay the new pricing model, citing discrepancies between government estimates and industry projections.
Deposit returns and recycling costs
Separate changes to alcohol container recycling could also influence prices. Under an agreement announced in November, grocery stores will not collect empty containers; instead, returns will continue at The Beer Store locations, with grocers covering associated costs. Some retailers may absorb those expenses, while others could pass them on to consumers.
As the new rules take effect, industry groups say price increases are not guaranteed—but they are possible—depending on how businesses respond to higher wholesale and operational costs in the months ahead.