Restaurants not phased by HST, so far 

Weather, economy impacting business levels more than new tax, say food operators

Local restaurants say the harmonized sales tax hasn't significantly hurt business, contrary to survey results from restaurants across British Columbia.

July business was generally strong for restaurants and pubs throughout Whistler despite the additional seven per cent tax on meals that came with the introduction of the HST.

"I would say that when the weather is bad, we are negatively affected by the HST," joked pub and bar owner Joey Gibbons. "And when the weather is good, we are not affected all."

Gibbons said business levels in Whistler have become so inconsistent that the weather has a more measurable impact than the harmonized sales tax, which fused the seven per cent provincial sales tax (PST) with the five per cent federal Goods and Service Tax (GST).

Up until July 1, restaurant meals were exempt from the PST, while the total taxes on alcohol equaled 15 per cent. Now, all items face the same 12 per cent tax.

Bob Dawson, owner of the Rim Rock Café, added not only has no one refused to pay for food because of the new tax, but now the billing process is much more simple with one tax instead of two.

"People used to always ask, 'What is PST?'" said Dawson. "Now, it is simple. It is 12 per cent on everything."

Dawson, who is part of the local restaurant association, said perhaps the lack of reaction in the resort municipality is because many people visiting Whistler from places like the UK or Australia are already used to paying huge taxes.

He added that the restaurant association hasn't met since the HST came into effect.

"I don't know what the pulse of Whistler restaurants is right now," he said. "To be honest with you, I haven't talked to too many restaurateurs about it."

Lawrence Black, owner of Black's Restaurant and Pub, said this July was the best ever for his business.

"There have been very few comments about the HST," said Black.

"I don't know if that is because we have a different market than the Lower Mainland or not. Maybe it is because Europeans are used to paying big tax, and so are other Canadians."

The experience of Whistler restaurant owners stands in stark contrast to the recent survey results released by the Canadian Restaurant and Foodservices Association.

Last week, the association issued a press release saying the HST negatively impacted 72 per cent of restaurants in B.C.

The B.C. restaurant industry's worst fears about the HST have been realized, read the press release. On average, respondents reported a 10 per cent decline in sales compared to the same period last year.

The survey was conducted online between July 26 and 31 with 802 restaurants across the province participating.

"There's no question the HST is hurting B.C. restaurants of all types, from fine dining to take out," said Garth Whyte, president and CEO of the association, in the press release. "With numbers like these, we urgently need government to work with us to mitigate the negative impact of tax harmonization."

Mark von Schellwitz, vice-president of the association's Western Canada chapter, added in an interview that quite a few participating restaurants were chains with other locations throughout the country. Those chain restaurants saw a drop in sales in B.C. but not in other provinces.

"In other areas of Canada sales are improving as the recession is mostly behind us," said von Schellwitz. "That isn't the case in B.C."

The president of the Whistler Chamber of Commerce agreed with comments from local restaurateurs that weather and the struggling economy are much larger concerns than the HST in Whistler.

"I suspect the introduction of HST will not impact our guests' decisions to come here," said Fiona Famulak.

"If they are local, they have to pay HST wherever they go in B.C., so we are competitive from that point of view. If they are not local, they have decided they want to experience the highway, or the Olympic rings, or the Peak to Peak, and I doubt the HST will impact those types of lifestyle decisions."

Famulak added that, with only a month's worth of data, it is too early to understand the impact of the HST.

"Anecdotally, I know that our members experienced a smooth implementation of the HST process, and I know many of our businesses in the food and beverage and retail sectors are reporting business levels that are equal or better than 2009," she said.

 

 

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