Members of Canada’s restaurant industry are urging the federal government to make the current GST holiday on dining out a permanent measure. The tax break, introduced for restaurant meals from December 14 to February 15, has been credited with increasing sales and customer visits during the traditionally slow holiday season.
Bill Pratt, CEO of the Chef Inspired Group of Restaurants in Nova Scotia, described the initiative as a hit among diners. “People are just freaking loving it,” Pratt said. “Let’s keep it going.”
Industry group Restaurants Canada reported a modest rise in dining out in December compared to the same period in 2023. OpenTable, a reservation platform, saw an 18% increase in online bookings between December 14 and 27 year-over-year.
Kelly Higginson, CEO of Restaurants Canada, noted that customers appeared to be spending more and visiting restaurants more frequently. “I think people started to see their bills and realized stopping for that snack or ordering a better bottle of wine wasn’t as expensive without the 13% GST,” she said.
Pratt echoed this sentiment, observing an increase in weeknight diners at his restaurants.
Despite the success some establishments have experienced, others have reported minimal impact from the GST break.
Arturo Anhalt, founder of Milagro Cantina in Toronto, said the tax holiday hasn’t significantly boosted business at his Mexican restaurant. “We thought it would have an effect, but people don’t really seem to care,” he said, adding that January has been slower than expected.
Stacy Porter, owner of Stacy’s Island Flavor Restaurant and Caterers in Toronto, shared a similar experience. While her Jamaican restaurant hasn’t seen an increase in customer volume, she noted that existing patrons were adding more items like drinks or sides to their orders.
Higginson expressed concern about the end of the GST break after Valentine’s Day, fearing it could reverse the positive trends seen in recent months. Restaurants Canada has already begun discussions with policymakers about extending the tax relief permanently to support the industry.
For many in the restaurant business, the GST holiday offers hope during challenging times marked by slim profit margins and rising costs of labour.
“This is a stressful period for everyone,” Anhalt said. “Anything that helps the restaurant industry is worth considering.”
The GST holiday, which also applied to groceries, toys, and children’s apparel, was introduced by the federal government to help Canadians cope with the rising cost of living. Whether it becomes a permanent fixture remains to be seen.