Restaurants Canada is pleased the government plans to enhance the Working Income Tax Benefit (WITB) by $500 million per year, as announced in today’s fiscal update.
“As much as we don’t like the absence of a plan to rein in the deficit, we believe budgetary measures that encourage work are a great way to help low-earning Canadian families and the economy,” said David Lefebvre, Vice President, Federal and Quebec for Restaurants Canada. “Our association has been a fan of the WITB since it was first introduced in 2007 because it is an efficient tax measure to boost the earnings of working Canadians while also being positive for business competitiveness.”
Other well-meaning policies, intended to help low-earning Canadians, such as too-high, too-fast minimum wage increases, result in less hours and less work for entry level workers who may be part of high income families. Because the WITB is based on family income, it directly benefits those most in need.
The WITB also provides incentives to work, which is valued by restaurant operators, who are experiencing labour shortages in many parts of the country.
Small business tax changes
With regard to small business tax changes, the government is continuing to give signals that it is listening to concerns raised by Restaurants Canada and other small business groups. Though many details have not yet been unveiled, the Finance Minister reiterated that government will facilitate in family business transfer, and respect the need for capital accumulation for business development and to prevent hardship due to seasonality and downturns. As much as the initial tax change proposals announced on July 18 were unacceptable, government appears to now be willing to take into account some realities of family businesses. As they stand, proposals are not perfect but they are much better than a few months ago.
Restaurants Canada is still concerned that proposed tax changes will affect retirement tax planning by restaurateurs, and that it could result in prohibitive tax rates. Restaurants Canada also awaits final details on in-family business transfers.
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.