HST tax increase delivers huge hit to B.C. families and tourists

    VANCOUVER, July 23 /CNW/ - The harmonized sales tax announced today will
deliver another blow to British Columbia's struggling tourism industry. The
tax on restaurant meals will jump from 5% to 12%, hitting families in the
wallet and discouraging international tourists.
    "This government made a promise less than three months ago to the people
of British Columbia that there would be no new taxes," says Mark von
Schellwitz, Vice President Western Canada for the Canadian Restaurant and
Foodservices Association (CRFA). "Harmonization will result in a permanent tax
shift of hundreds of millions of dollars to our customers."
    To make matters worse, a 12% tax will likely accelerate the sharp decline
in international tourists visiting British Columbia. "U.S. tourists are
already shocked by the 5% GST when they dine out in B.C.," says von
Schellwitz.
    The HST will also discourage local restaurant customers, who can buy the
same or similar food tax-free at grocery stores. Grocery stores now offer
frozen, heat-and-eat versions of just about every item on a restaurant menu -
from lasagne to samosas - and all tax free.
    "As one of the largest employers in British Columbia, we're deeply
concerned about the damage the HST will do to restaurant owners, their
customers and their employees," says Garth Whyte, CRFA President and CEO.
"Government should be creating the conditions for these businesses to prosper
and grow. The significant tax increase on restaurants caused by harmonizing
the PST and GST in this province will do precisely the opposite."
    The HST will result in a permanent drop of $750 million a year in
restaurant sales in British Columbia - or nearly $50,000 per year for the
average restaurant - according to a CRFA calculation using an econometric
model from the Conference Board of Canada.
    More than 173,000 people, representing 7.5% of the workforce, are
employed in British Columbia's restaurant industry.

    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.

For further information: Mark von Schellwitz, CRFA Vice President
Western Canada, [phone] or [e-mail]; Jill Holroyd, CRFA Vice
President Research and Communications, [phone] or [e-mail]