Today’s federal budget is a mix of good and bad news for restaurant and bar operators. The industry is pleased to see progress on trade liberalization and tourism funding, but surprised and disappointed by a 2% increase in the excise tax on alcohol, which will cost consumers and licensees $470 million over the next five years.
“Alcohol is already an over-taxed commodity in Canada, so today’s increase is unwelcome news for licensees and their customers,” said Joyce Reynolds, Restaurants Canada’s Executive Vice President, Government Affairs. “This increased federal tax, compounded by the myriad provincial taxes and liquor board markups, won’t help the hospitality industry grow jobs or the economy.”
The budget has some good news. It calls out an agreement that establishes a process for future trade liberalization in areas like interprovincial trade in alcoholic beverages – a key priority for Restaurants Canada.
It also includes $37.5 million of permanent funding for tourism marketing.
“Restaurants Canada looks forward to working with the federal government to grow the vibrant culinary sector, which is a key component of a successful tourism strategy,” said Reynolds.
Canada’s restaurant industry generates $80 billion annually in economic activity, directly employs 1.2 million Canadians, is the number one source of first jobs, and serves 18 million customers every day.
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