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Cutting the tax credit on tips will leave Quebec restaurants in the lurch: Restaurants Canada


March 20, 2015
By Canadian Pizza

March 20, 2015, Montreal – To help balance the Quebec's budget, Fiscal Commission Chair Luc Godbout recommends
lowering the tax credit on tips declared from 75 to 50 per cent, a move
Restaurants Canada says will hurt the province's restaurant industry.

March 20, 2015, Montreal – To help balance the Quebec's budget, Fiscal Commission Chair Luc Godbout recommends
lowering the tax credit on tips declared from 75 to 50 per cent, a move
Restaurants Canada says will hurt the province's restaurant industry.

“It’s important to understand the tax credit on tips declared is not a
subsidy to the restaurant industry,” Jean Lefebvre, Restaurants
Canada vice-president for Quebec, in a news release. “To be completely fair, restaurateurs
should not have to pay any tax on revenue – such as employee tips – that
they have no access to.”

The Quebec government introduced a tax credit of 90 per cent in 1998
to reimburse restaurateurs for the taxes they paid on employee tips.
This credit was lowered to 75 per cent in 2003, and is now facing the
threat of reduction again.

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“Cutting the tax credit on tips declared would cost the average
restaurant another $2,500 a year, which is completely unaffordable,” Lefebvre said. “Mr. Godbout wants to help the government balance its
budget at the expense of restaurants, which are already struggling under
intense cost pressures.”

The province’s restaurants directly employ nearly 270,000 Quebecers, of
which one in five is under the age of 25. The restaurant industry is the
number 1 source of first-time jobs. 

“Our members want to partner with the government to boost job and
economic growth,” Lefebvre said. “We hope the government rejects such
measures that will force many restaurants to close their doors and cut
jobs.”