Restaurants Canada calls for assistance for N.L. restaurant industry

Restaurants Canada is urging the provincial government to help the restaurant industry after eight days of a state of emergency on the northeast Avalon.

Luc Erjavec, vice-president for Atlantic Canada of the association, wrote a letter to Premier Dwight Ball and Finance Minister Tom Osborne with a list of requests he says will help restaurants.

According to the letter, 16,500 people work in the restaurant industry, spread among 1,200 businesses in the province.

In the letter, Erjavec says a slow economy has hurt the industry, with the Jan. 17 blizzard making it harder for the industry to recover the lost revenue.

“Unfortunately, Newfoundland and Labrador’s economy has lagged behind all other provinces with an average annual decline of 0.1 per cent over the past five years,” writes Erjavec.

“As a result, restaurateurs have been struggling to get by with an average pre-tax profit margin of just 4 per cent. For drinking places the situation is even worse, with licensed bars and restaurants averaging a pre-tax profit of just 2 per cent and 3.5 per cent, respectively.

The recent blizzard has further exacerbated this already challenging situation for food-service operators and many businesses could be in jeopardy.”

The letter asks for wholesale pricing for alcohol, which is currently offered in the rest of Atlantic Canada. Prince Edward Island and Nova Scotia offer a 10 per cent discount on some alcohols to bars and restaurants, while no such discount exists in this province.

The letter asks that the industry to be exempt from the 15 per cent provincial tax on insurance premiums.

The 15 per cent retail tax on insurance was introduced to all insurance premiums in the province as part of the 2016 provincial budget, but it was eliminated on auto insurance tax as part of the 2019 provincial budget.

Not all the requests are related to the Jan. 17 storm.

The letter asks the government to maintain its current commitment to link the minimum wage to inflation, while also introducing a lower training wage, and a lower liquor-serving wage “recognizing the significant gratuities earned by servers.”

Erjavec says thegovernment needs to step in and help the restaurant industry.

"Unfortunately, they are struggling, through no fault of their own, and it is incumbent upon the government to act so that they can continue to contribute to the province’s social and economic well-being.”