Restaurant owners say the HST will significantly hurt their business
FOR IMMEDIATE RELEASE
August 4, 2009
VANCOUVER – The vast majority of restaurant owners -- 91% -- say a harmonized sales tax in British Columbia will have a negative impact on their business, according to a survey of the Canadian Restaurant and Foodservices Association’s 4,000 B.C. members.
Eighty-five per cent of respondents said the HST will have a “significantly negative” impact and 6% said it would have a “slightly negative” impact. Only 9% responded that it will have no impact or a positive impact on business.
“The survey results echo what we’ve been hearing loud and clear in emails, phone calls and faxes from our members over the past two weeks,” says Mark von Schellwitz, CRFA Vice President Western Canada. “Adding a 7% PST onto the 5% GST will more than double the sales tax on restaurant meals. This will result in a dramatic decrease in consumer spending on eating out.”
When asked specifically how the HST will impact their business, 90% of respondents said their customers will cut back on spending, and 71% said they will have to cut back on staff or staff hours.
“Restaurants are at the heart of every community in British Columbia, and an important employer for people of all ages and walks of life,” says Garth Whyte, CRFA President and CEO. “The HST announcement has created a great deal of uncertainty for our members. It is clear they are deeply concerned about the damage the HST will do to their business. We will be looking to the B.C. government and the federal government to fix this major tax shift onto the restaurant sector.”
The restaurant and foodservice industry is one of the largest employers in B.C., with 173,000 direct employees, including 80,000 young people under the age of 25.
CRFA is one of Canada's largest business associations, with 33,000 members representing independent and chain restaurants, bars, caterers, institutions and other foodservice providers. Canada's $60-billion foodservice industry employs more than one million people in communities across the country.
CRFA Member Survey: British Columbia HST
Q 1: How will a 12% harmonized sales tax (HST) on restaurant meals in British Columbia hurt your business? (select one answer only)
Significantly negative impact 85%
Slightly negative impact 6%
No impact 1%
Slightly positive impact 1%
Significantly positive impact 8%
Q 2: If there is a negative impact on your business, what will it be? (select as many as apply)
Customers will decrease their spending at my restaurant 90%
I will cut back on staff/staff hours 71%
I will not expand my business/open new restaurants 36%
I will reduce my hours of operation 21%
I will shut down my business 6%
Other 7%
Q3: What type of foodservice establishment do you operate? (select one answer only)
Quick-service restaurant 47%
Table-service restaurant 38%
Contract caterer 4%
Bar, tavern, pub, nightclub 6%
Other 4%
Q4: Does your establishment have a liquor license? (select one answer only)
Yes 47%
No 53%
The CRFA Member Survey was conducted through an online and fax survey between July 29 and Aug. 4, 2009. A total of 365 members completed the survey, and results are considered accurate within +/- 5 %, 19 times out of 20. Totals may not add to 100 due to rounding.
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