While we are encouraged by the government’s commitment to address labour shortages through immigration measures and tax incentives to encourage work, Restaurants Canada is disappointed by the government’s lack of appreciation for the fiscal challenges that the foodservice industry and small businesses everywhere are faced with today.
For example, Canadian small business owners still face some of the highest credit card fees in the world. After a year-long study of the payment sector the budget offers more consultation instead of action.
Payroll taxes are scheduled to increase significantly over the next five years due to CPP contribution increases. Instead of providing an offset for labour-intensive businesses that are hardest hit by these profit-insensitive payroll taxes, EI premiums are scheduled to increase.
Continuation of the dangerously precedent-setting escalator tax on alcohol is also disappointing.
We would have also liked to have seen better protections for in-family business transfers and better recognition of the non-paid contribution of shareholders in the budget.
Absence of any new or additional funds or indications about culinary tourism also comes as a surprising omission. On a positive note, we welcome government’s efforts to focus on the expediency of processing immigrant and refugee applications so new Canadians can receive residency status in a timely manner so that they can quickly be matched with employers experiencing labour shortages.
Also helpful to an industry with wide-spread labour shortages is the expansion of the Working Income Tax Benefit, now the Canada Workers Benefit (CWB) program, which will provide incentives for unemployed Canadians to join the workforce.
We are happy to have clarification on small business tax changes and the threshold on passive income. The budget modifications are recognized as a positive step for the industry.
Pushing the implementation of some of the most complicated new proposals to 2019 is also appreciated, as it provides operators more time to adjust to tax reforms. We commend the government for the progressive aspect of this new system, which is consistent with Restaurants Canada’s recommendation.
Overall we believe that there are important positive steps in the budget that will provide some support for our industry but we believe that much work remains and we look forward to partnering with government to move one of Canada’s key growth sectors forward.
Restaurants Canada is a growing community of 30,000 foodservice businesses, including restaurants, bars, caterers, institutions and suppliers. We connect our members from coast to coast, through services, research and advocacy for a strong and vibrant restaurant industry. Canada’s restaurant industry directly employs 1.2 million Canadians and serves 18 million customers every day.