TORONTO, July 30, 2013 /CNW/ -
Dear LCBO Board of Directors,
I am writing to you on behalf of an industry that represents nearly 10
per cent of LCBO sales, contributes $25 billion annually to Ontario's
economy, and employs 425,000 Ontarians.
Restaurant and bar owners across the province were disappointed and
frustrated to learn that the Liquor Control Board of Ontario has
granted a 49 per cent price discount -- equivalent to wholesale pricing
-- to foreign diplomats and the federal government, while continuing to
mandate that restaurant industry licensees pay full retail price.
Yet again, the LCBO has demonstrated that it is out of touch with
current business challenges, and the financial burden of an overly
complicated liquor control system. Sales at bars and pubs in Ontario
fell almost 10 per cent in 2011 and barely rose in 2012. The LCBO's
continued refusal to follow normal business practices and introduce
wholesale pricing for licensees is perpetuating these challenges, and
is an insult to thousands of business owners.
Restaurateurs and bar owners generate HST on every beverage and pay
corporate, property and income taxes. These financial contributions
help to pay for health care, education, and the municipal services
provided to Ontarians. Providing diplomats with a discount provides no
benefit to Ontarians. Restaurateurs and bar owners also create spin-off
jobs and economic activity that diplomats do not.
Ontario restaurant owners have one of the lowest pre-tax profit margins
in Canada, averaging just three per cent of operating revenues.
Providing a wholesale price discount would mean that restaurant owners
could grow their businesses, create new jobs, and support their
communities. As well, permitting restaurateurs to sell wine, beer and
spirits at prices closer to those seen in the LCBO will encourage
Ontarians to support local restaurants, increase sales, and generate
additional tax revenue for the Ontario government.
While CRFA has no expectation that the LCBO would ever consider matching
the generous discounts you are providing to diplomats, we hope you will
consider introducing a little more fairness into the beverage alcohol
system for hard working Ontario business owners.
Executive Vice President, Government Affairs
SOURCE: Canadian Restaurant and Foodservices Association
For further information:
CONTACT: Prasanthi Vasanthakumar, CRFA media contact at (416) 649-4254 or email@example.com.