As HST break on restaurant meals ends, owner of Fredericton diner tallies up
David Halfyard says tax holiday likely helped a little, restaurant industry would like to see it extended
Saturday marks the end of the federal government's two-month sales tax holiday, giving Canadians a break on the cost of some essential goods, including restaurant meals.
And while David Halfyard's customers at The Cabin restaurant in Fredericton have been enjoying the 15 per cent discount, he's not sure if it's enough to actually change anyone's habits.
"Who doesn't like getting a discount? People love it. As to whether they would stop coming out because it's off, I don't know," he said.
Halfyard has already crunched the numbers and said his sales during the two-month window that started Dec. 15 are down. But he's still convinced the tax break helped.
"I'm sure I gained a little bit of extra business because of it. How much, I couldn't put a finger on it," he said.
"The world being what it is today, it's hard to compare last year with this year. People are just a little scared to go out spending, and they're just being conservative right now, even with the tax cut," Halfyard said.
"We're all a little scared of where we're headed."
Halfyard said he has had to raise his prices more often than he would like.
"I'm a little diner and it costs you close to $20 to come and get bacon and eggs and a coffee. I apologize for that, but that's the way it is. There's nothing I can do about it."
Tax holiday data not available yet
The official tally on spending during the break will come from Statistics Canada at a later date, but at least one organization representing the restaurant industry said it's had a positive impact.
Janick Cormier, vice-president Atlantic at Restaurants Canada, partnered with the reservation platform Open Table to collect data.
She said there was an eight per cent bump in reservations in Atlantic Canada during the tax holiday.
Ontario saw a 23 per cent increase over that same period, according to Open Table.
"We're living in a world where 53 per cent of restaurants are currently operating at a loss or are barely breaking even," Cormier said.
"So any little thing that will get people through your doors, or to encourage them to have that dessert or have that glass of wine, will help with the bottom line."
She would like to see the government extend the tax break to help "ride this second huge wave of economic turmoil.
Customers divided over tax break
During the last week of discounts, diners at the Cabin had mixed reviews on the government spending, but for Willis Storey, it provided much needed relief at a time when all food prices are high.
"It's expensive eating out and it's expensive buying groceries these days. I went and looked at a little steak there the other day … $20. It's crazy."
But Blaine Desroches said he hasn't noticed the difference in his bills, and it hasn't changed his eating habits.
"We go out two or three times a week, minimum, to ... eat and stuff like that. So it hasn't made us go out anymore or less, but 15 per cent is always nice."
Mike Jennings said he didn't agree with the tax break, and it hasn't influenced his spending at all.
"I do not think it was money well spent," he said. "I think we have high deficits and debts, and I think that's where the money should be from the government. I don't think this is going to help us much at all."
No 'windfall' for retail industry
Jim Cormier, the Atlantic Director for the Retail Council of Canada, said "any type of incentive to get people to shop is a good thing for all of our members and good for consumers. But we didn't see a windfall."
"Everything we heard was people weren't necessarily spending more, they'd often forget," Cormier said.
"And when they got to the cash, they realized that they were paying 15 per cent less. So it was good for them, but … didn't necessarily result in the customer saying, "Oh, well, I'll spend more.'"
Cormier said instead of a tax break for consumers on certain commodities, he would like to see Ottawa lower corporate taxes to benefit businesses.
He said he is optimistic we'll see a return to spending in the spring, and "then we'll hope that some of what's happening to the south of us doesn't materialize. And if it does, our government will be able to work hard to find other markets."
Uncertainty over U.S. threats and tariffs
Tim Rissesco, president of Downtown Atlantic Canada, believes the tax break "was a good move in December when people were dealing with a bit of an affordability crisis."
But right now, "small businesses and downtowns are going to need some help in preparing for a looming trade war with the United States."
Rissesco would like to see the HST cut continue, but he would also like to see long-term support for buying local to fight against incoming tariffs from the United States, and he thinks the Government of Canada could be a big player in that initiative.
"It's getting harder and harder for people to stay in business and anything the government can do to encourage people [to shop local] would be welcomed in our downtowns and main streets."
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