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Drink up. You’re helping your government

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Alcohol is now a $20-billion business.

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It's a changing business, according to a new report, as wine, liqueurs, vodka and coolers become more popular. And it's one that's helping out our governments in troubled times.

Sales of wine, beer and spirits climbed 2.3 per cent last year to $19.6-billion, according to the report this week from Bank of Montreal.

"Growth in Canadian liquor sales was roughly on pace with broader retail sector growth in 2013, with Saskatchewan and Quebec registering strong year-over-year gains of 5.7 per cent and 3.7 per cent, respectively," said BMO economist Aaron Goertzen.

"According to the most recent Statistics Canada data, alcohol sales contributed $6.1 billion to government coffers Canada-wide in fiscal year 2012, including both direct provincial government revenue and the unremitted profits of alcohol authorities."

Canadians are increasingly favouring wine, whose share of liquor sales has climbed to more than 30 per cent from less than 20 per cent two decades ago, Mr. Goertzen said.

That's based on value, though Mr. Goertzen noted that both volumes and average prices have increased.

And in case you're wondering, red wines have come on strong, with sales by volume surging 283 per cent since the mid-1990s compared to 29 per cent among white wines.

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And let no one utter the word "hoser" again. The rise of wine has come "mainly at the expense" of beer, whose share of alcohol sales has withered to 44 per cent from 53 per cent two decades ago.

Spirits are also losing their spirit, though sales of liqueurs, vodka and coolers have surged.

According to Statistics Canada, that $6.1-billion take among provincial and territorial liquor authorities was up 3.6 per cent from about $5.9-billion in the year ending March 31, 2011.

Notable there are some regional breakdowns: The take in Prince Edward Island rose 8.3 per cent, in Newfoundland and Labrador by 7.4 per cent, and in Quebec by 7.6 per cent.

Growth rates in other provinces were nowhere near those levels, and actually declined in Nova Scotia and the Northwest Territories.

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About the Author
Report on Business News Editor

Michael Babad is a Report on Business editor and co-author of three business books. He has been with Report on Business for several years, and has also been a reporter and editor at The Toronto Star, The Financial Post and United Press International. His articles have appeared in major newspapers around the world. More

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