One B.C. restaurant owner is being applauded for his transparency for covering part of the employer health tax with an up-front charge on customer bills, but the idea isnB次元官网网址檛 catching on yet.
As B.C. small businesses deal with the cost of the new tax on the portion of their payroll exceeding $500,000, they have to look at strategies to cover another cost, along with rising minimum wage, property tax and supplier increases.
In the restaurant business, with part-time staff and narrow profit margins, the choices came down to four, says Rob Chyzowski, owner of BellevilleB次元官网网址檚 Watering Hole and Diner in downtown Victoria. With the new health tax costing him an estimated $40,000 a year, he could lay off staff, increase the price of food and beer, reduce serving sizes or add a new charge to the bill.
Chyzowski opted for the latter, a one-per-cent charge on customer bills labelled B次元官网网址淏CHB次元官网网址� to represent the additional cost. He says most customers have accepted it.
Ian Tostenson, president of the B.C. Restaurant and Food Services Association, says he hasnB次元官网网址檛 heard of any other restaurant or pub going the same route.
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B次元官网网址淭here is a concern about the cost of the health tax, no question about it,B次元官网网址� Tostenson said Friday. B次元官网网址淏ut there has been nobody else whoB次元官网网址檚 come out and said, B次元官网网址業B次元官网网址檓 doing this.B次元官网网址� So I think the industry is probably looking at, will it work, and maybe if it works, they should do the same thing.B次元官网网址�
Another Vancouver Island restaurant owner, Calen McNeil, is looking at his options as his Big Wheel Burgers chain has grown to four restaurants. He pays above minimum wage and health benefits to keep employees in a tight market for skilled workers, but he says the new payroll tax is pushing him below the break-even point.
B次元官网网址淚n effect I have to borrow the money to pay the tax,B次元官网网址� McNeil told radio station CKNW this week.
His latest burger restaurant opened in Nanaimo, but for further expansion, heB次元官网网址檚 looking outside B.C.
The must be paid quarterly by most larger companies, at a rate of 2.925 per cent on payroll amounts between $500,000 and $1.5 million. Above that, the tax is charged at 1.95 per cent, applying to B次元官网网址渁ll remunerationB次元官网网址� including benefits paid to employees.
The B.C. government has an employer health tax so business owners can estimate their payroll and meet the quarterly deadlines to pay it. That system earned the B.C. government a B次元官网网址減aperweight awardB次元官网网址� from the Canadian Federation of Independent Business this week for imposing complicated regulations on business.
tfletcher@blackpress.ca
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