Ontario's rejection of tax harmonization good news for consumers

    TORONTO, March 26 /CNW/ - With yesterday's budget the Ontario government
continued to resist Ottawa's push for sales tax harmonization, and that's good
news for restaurant operators and their customers.
    "In recent statements, Minister Flaherty fails to point out what Minister
Duncan and the Ontario government have recognized - that harmonization would
significantly shift the tax burden from business to consumers, eliminating the
provincial sales tax exemption on numerous items, including restaurant meals
under $4.00," says Elaine Flis, Ontario Vice President with the Canadian
Restaurant and Foodservices Association (CRFA), which opposes sales tax
harmonization unless flaws in the GST are fixed.
    The GST was a recipe for disaster for restaurateurs. It created an unfair
playing field by taxing some food products but not others, based solely on
where they are purchased. You can buy a carton of milk at a convenience store
tax free, but you'll pay GST when you buy the same item at a cafeteria. You
can buy ready-to-heat pizza at a grocery store tax free but you'll pay GST
when you buy pizza from a restaurant.
    On restaurant purchases alone, harmonization would cost Ontario consumers
$250 million a year in new taxes.
    Ontario is home to 34,700 restaurants, bars and caterers. The province's
$22-billion restaurant industry employs nearly 405,000 Ontarians and accounts
for 3.7% of provincial GDP.

    CRFA is one of the largest business associations in Canada, representing
restaurants, bars, caterers and other foodservice providers.

For further information:

For further information: Elaine Flis, CRFA Vice President, Ontario,
(416) 738-9546 (cell); Jeni Armstrong, CRFA Communications Specialist,
1-800-387-5649, ext. 4254

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