Alberta to scrap ad valorem wine tax

The Alberta government is scrapping its levy on high‑value wine, a move industry leaders say will restore fairness and boost quality options for consumers.

The province’s 2026 budget confirms that the ad valorem markup applied to wine priced above $15 per litre will be eliminated on Apr. 1, exactly one year after it was introduced.

The tax had added between 5 and 15 per cent to the cost of higher‑priced bottles, on top of the existing flat markup of $4.11 per litre. The province will now raise the flat markup rate by $0.58 per litre.

For retailers like Calgary’s Metrovino Fine Wines, the reversal is welcome news.

“I was elated,” said co‑owner Al Drinkle.

He argues the tax distorted the market by favouring mass‑produced wines.

“It started at such a low point that the only wines that were exempt from the tax were ones that were industrially produced and corporately traded.”

Drinkle says the added cost forced many customers to compromise on quality.

“If someone was in the habit of spending $20 a bottle, or $25 or $30… they were still spending the same amount but compromising the quality with what they are taking home and drinking. At the very high end, it certainly demolished the category.”

Service Alberta Minister Dale Nally described the tax as an “experiment.”

“Liquor volumes are declining, and so we are always looking at new and inventive ways to generate new revenue,” Nally said. “We heard loud and clear from Albertans, they didn’t like the ad valorem, they found it complicated… even though it only applied to 16 per cent of the wines sold.”

The Alberta Hospitality Association says the change is a relief for restaurants and bars.

“I don’t think the tax was producing as much income as the government would have liked,” said executive director Mona Pinder. “We’re glad that the government looked at their poor policy and made the change.

“We are looking forward to April 1.”