HALIFAX: Restaurants Canada is calling on the Nova Scotia government to follow the lead of Newfoundland and Labrador and Ontario by giving a tax holiday on the provincial portion of the HST in the federal government’s GST tax holiday.
The tax holiday applies to items such as groceries, restaurant meals, drinks, snacks, children’s clothing, and gifts from December 14 to February 15.
Nova Scotia getting on board would fully realize the potential of this tax holiday for citizens and help struggling small businesses.
“Our restaurateurs play a vital role in the economic and social vitality of our communities across Nova Scotia, but we, along with our customers, are hurting,” said Richard Alexander, Vice President Atlantic (Acting), Restaurants Canada. . “Due to affordability challenges, half of restaurants in the province are not making money, compared to 12% in 2019. Including the provincial portion of the HST in the holiday will not only help consumers with affordability, it also helps restaurants make it through the slow post-Christmas season.”
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The restaurant industry is a key economic driver for Nova Scotia, generating $2.7 billions in sales, nearly 40,000 direct and indirect jobs, and supporting the tourism product.
Yet, economic pressures, inflation and increased operational costs continue to pose major challenges for restaurateurs.
Including the provincial portion of HST in the federal tax holiday will:
- Help Nova Scotians save: Lowering the cost of dining out during the Christmas season means more households can enjoy meals at their favorite restaurants, fostering connection and easing financial pressure.
- Drive economic growth: Increased activity fuels spending across local communities, benefiting suppliers, farmers, and other businesses.
- BMO economics forecasts that this measure will boost Canada’s economic growth from 1.7% to 2.5% in Q1 2025.
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- Support small business recovery: Reducing tax burdens allows restaurants and other small businesses to reinvest in jobs, innovation, and sustainability.
- Keep Nova Scotians’ dollars in Nova Scotia: Consumer will be more likely to cross provincial borders and make purchases in provinces that have included the PST in the federal GST tax holiday if Nova Scotia does not offer the same tax break.
- Protect the province’s winter tourism product: Tourists will be incentivized to vacation elsewhere in January and February if the PST remains applicable in the province.
Premier Houston received a strong vote of confidence from the people of Nova Scotia when he committed to address affordability by decreasing the HST by one percent. The federal GST tax holiday provides an unexpected opportunity to help Nova Scotians even more.
