Restaurant industry welcomes federal budget tax relief, access to credit
FOR IMMEDIATE RELEASE
Jan. 27, 2009
OTTAWA – Tax relief for consumers and businesses, along with better access to credit for restaurant owners, is welcome news for Canada’s foodservice industry in today’s federal budget.
The foodservice industry, which employs more than one million Canadians and generates just under four per cent of the country’s gross domestic product, is expecting a 4.6 per cent real decline in sales in 2009 due to the slowing economy, according to a forecast by the 33,000-member Canadian Restaurant and Foodservices Association (CRFA).
“Putting more disposable income in the hands of consumers, reducing the tax burden on small business owners, and allowing credit-worthy restaurant businesses to access much-needed lending are positive moves for our industry,” says CRFA’s Vice President Labour and Taxation, Justin Taylor.
CRFA strongly supports the following budget measures:
- The increase in the Basic Personal Income Tax exemption and the Working Income Tax Benefit, which will increase disposable income for low-income Canadians and help restaurants by encouraging more people to enter and remain in the workforce.
- The steps the government has taken to increase access to credit for restaurants by increasing the maximum loan guarantee under the Canada Small Business Financing Program and by increasing lending through the Business Development Bank of Canada.
- Increasing the small business tax rate threshold from $400,000 to $500,000. This allows more small businesses to take advantage of a lower income tax rate.
- The steps the government has taken to ensure unemployed Canadians have access to the EI benefits they need without increasing costs for employers. CRFA is concerned, however, that increased costs to the program caused by rising unemployment will lead to higher EI premium rates in 2011 once the premium rate freeze is over.
- The federal government’s continued support for apprenticeship programs through increased tax credits for businesses that hire apprentices through the Red Seal program.
Restaurant owners are disappointed the government did not act to rein in rising credit card fees.
“While the government has taken steps to protect consumers from predatory practices of credit card companies, they must remember that businesses are consumers of these financial products as well, and must take steps to ensure that fees charged to businesses are fair, transparent, and predictable,” says Taylor.
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