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

Avoid giving dogs ice cubes, says Greater Victoria vet

Tips for keeping dogs cool and safe this summer

Hungry Hearts Gala goes virtual with new mac and cheese competition

Results will be announced on Facebook live stream event

GVPL staggers reopening of three more branches in Oak Bay, Saanich and Victoria

More Greater Victoria Library branches to reopen in August

Gaps in the system: Youth cope with homelessness in Greater Victoria

Four-part series will look at youth homelessness in the region

Rolling the dice on the patina of old copper

At the Galleries: Summer days continue

53 new COVID-19 cases, no new deaths cap off week of high infection rates in B.C.

Roughly 1,500 people are self-isolating because they either have COVID-19 or have been exposed to it

Unofficial holidays: the weird and wonderful things people celebrate around the world

On any given day of the year, there are several strange, silly or serious holidays to observe

Missing teen visiting Courtenay found safe

She had last been seen going for a walk on Aug. 6

Moving on: Tanev scores 11 seconds into OT as Canucks oust Wild

Vancouver beats Minnesota 5-4 to move into first round of NHL playoffs

Fitness non-profit challenges citizens to invent a game to be physically active

The campaign was launched after a study showed only 4.8 per cent of children and youths in Canada met required standards of the 24-hour movement guidelines

Gene editing debate takes root with organic broccoli, new UBC research shows

Broccoli is one of the best-known vegetables with origins in this scientific haze

VIDEO: U.S. Air Force pilot does fly-by for B.C. son amid COVID border separation

Sky-high father-son visit plays out over White Rock Pier

3 Vancouver police officers test positive for COVID after responding to large party

Union president says other officers are self-isolating due to possible exposure

Vancouver Island team takes on wacky challenges of world’s largest scavenger hunt

Greatest International Scavenger Hunt taking place Aug. 1-8

Most Read