End GST/HST on food in permanently: Restaurants Canada
The recent tax holiday boosted sales and created jobs in the foodservice sector, the industry group notes
Article content
OTTAWA — With a big contraction expected in Canada’s restaurant sales, an industry group is calling for a permanent end to federal sales tax on food.
In their most recent quarterly report, Restaurants Canada is forecasting foodservice sales to contract by between 0.4% and 1.5% this year, and between 0.6% and 1.4% in 2026 — all variable due to the ongoing U.S. trade war.
tap here to see other videos from our team.
End GST/HST on food in permanently: Restaurants Canada Back to video
tap here to see other videos from our team.
“We face significant challenges, both as an industry and as a country, so government needs to use all the tools at its disposal, including tax policy,” said Restaurants Canada president Kelly Higginson.
“We’re eager to work with Prime Minister Mark Carney and his new government on policies that enable the foodservice industry to grow its economic impact, create stable and rewarding jobs for Canadians and feed communities across the country.”
The recent GST holiday, touted by former PM Justin Trudeau as a means of temporary economic relief, provided a strong boost to restaurants, Restaurants Canada maintains — pointing to a 7.5% increase in January food sales.
Adjusted for inflation, that represents the highest real growth in the industry since April 2023.
“We now have definite proof that the GST/HST holiday boosted sales and created jobs in the foodservice sector, while preventing bankruptcies,” Higginson said.
“The new federal government can protect Canadian jobs and businesses in every community across the country and help Canadians with affordability by removing sales tax from all food permanently.”
Taxing a necessity like food, she said, is a bad approach to taxation.
The report states commercial food sales are forecast between $98 billion and $99 billion this year, that’s down from the $100 billion predicted prior to U.S. President Donald Trump’s trade war.
If tariff uncertainty extends into 2026, 71% of restaurant chains said they’d cut spending, while 63% said they’d raise prices, and around half would delay capital investments such as renovations — a situation the report says would have a significant negative economic impact outside of the restaurant industry.
Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.