Pubs and restaurants in B.C. are among the businesses looking for ways to cover the province’s new employer health tax. (Responsible Service B.C.)

Diners’ health tax not catching on in B.C., restaurant group says

Small businesses look for options to cover employer health tax

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 isn’t 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 Belleville’s 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 “BCH” 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 hasn’t heard of any other restaurant or pub going the same route.

RELATED: Employer health tax wins ‘paperweight award’ for red tape

RELATED: Full weight of B.C. employer health tax to be felt in 2020

“There is a concern about the cost of the health tax, no question about it,” Tostenson said Friday. “But there has been nobody else who’s come out and said, ‘I’m doing this.’ So I think the industry is probably looking at, will it work, and maybe if it works, they should do the same thing.”

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.

“In effect I have to borrow the money to pay the tax,” McNeil told radio station CKNW this week.

His latest burger restaurant opened in Nanaimo, but for further expansion, he’s looking outside B.C.

The employer health tax 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 “all remuneration” including benefits paid to employees.

The B.C. government has an employer health tax calculator so business owners can estimate their payroll and meet the quarterly deadlines to pay it. That system earned the B.C. government a “paperweight award” from the Canadian Federation of Independent Business this week for imposing complicated regulations on business.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

BC legislature

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

South Surrey boy, 11, hopes to raise $3,000 for Sources – and be Prime Minister

White Rock Coldest Night of the Year event to take place Feb. 22

Recharged Sharks aim for playoffs after ‘well-earned’ break

Bayside rugby club mixes youth with returning veterans in quest for men’s Div. 1 title

Pedestrian fatality in Surrey

Police are investigating at 183 Street and Highway 10

Police watchdog seeking witnesses to Surrey arrest

It happened in a McDonald’s parking lot in Guildford on Jan. 18, at 152nd Street and 102A Avenue, at about 1 a.m.

VIDEO: Minister reports ‘modest progress’ after blockade talks with First Nation

Wet’suwet’en hereditary chiefs say Coastal GasLink does not have authority to go through their lands

B.C. man released from quarantined cruise ship in Japan

Because Spencer Fehrenbacher has American citzensip, he was evacuated by the U.S.

Henrique scores 2 as Ducks soar past Canucks 5-1

Vancouver tumbles out of top spot in Pacific Division

Trudeau cancels Caribbean trip amid pipeline protests across Canada

Protests against Coastal GasLink have disrupted rail service

B.C. VIEWS: Inaction on pipeline protests not a viable response

Columnist Frank Bucholtz on how the Coastal GasLink pipeline dispute got so bad

PHOTOS: Top 10 memories of the 2010 Olympics

Black Press Media’s Jenna Hauck, shares some of her most memorable images of 2010 Winter Games

#FoxForFiver: Support grows in B.C. to put Terry Fox on new $5 bill

Terry Fox’ Marathon of Hope raised money for cancer research

Registration opens soon for BC 55+ Games in Richmond

2020 55+ Games have been officially scheduled for Sept. 15 to 19

Trudeau confers with cabinet ministers as rail blockades continue

The Trudeau government has been criticized for not doing more to end the blockades

Most Read