REGINA — Saskatchewan has tabled its 2023-24 budget, which was primarily focused on debt reduction and improving the province’s overall fiscal position with a $1-billion surplus. Restaurants Canada was encouraged to learn the budget contained no new taxes or tax increases, which provides the industry with some stability. Unfortunately, it doesn’t provide any substantial cost relief for the struggling foodservice industry. The budget was also a missed opportunity for the provincial government to address a number of operational challenges impacting Saskatchewan’s restaurant sector.
In the 2023-24 pre-budget submission, Restaurants Canada and Saskatchewan-based restaurateurs recommended some key cost-relief measures, including:
- Re-instating the Provincial Sales Tax (PST) exemption on restaurant meals once the provincial budget is in a surplus position equal to, or more than, the PST restaurant meal revenue collected;
- Following the lead of Manitoba and Newfoundland with the introduction of a similar Small Business Minimum-Wage Adjustment program to mitigate the financial impact of Saskatchewan’s steep 27 per cent minimum-wage increase over the next three years; and
- Levelling the liquor-purchasing playing field by implementing wholesale liquor pricing for all hospitality licensees.
“Not even a year on from the end of pandemic-related restrictions, Saskatchewan’s restaurant sector is still struggling to recover from its lasting impact. The combination of disappointing revenues, skyrocketing operating expenses and acute labour shortages are making it incredibly challenging for foodservice operators to recover financially,” says Jennifer Henshaw, VP, Prairies and the North, Restaurants Canada. “The 2023-24 budget needed to send the right signals to the province’s foodservice sector, and the greater business community, that Saskatchewan is ready to support a strong economic recovery for some of the hardest hit industries. While the budget certainly moved the fiscal needle in the right direction without any tax hikes or new taxes, it missed the mark by failing to adopt Restaurants Canada’s impactful, common-sense recommendations to help our industry.”
A recent Restaurants Canada survey revealed that 75 per cent of table-service restaurants are still in debt due to the loss in business and rising costs during the pandemic. This compares to 66 per cent of all other foodservice, such as bars, and 51 per cent of quick-service restaurants. Of those still in debt, nearly 80 per cent of independent table-service restaurants owe between $50,000 and $500,000. Meanwhile, 20 per cent of chain table-service restaurants have incurred more than $1 million in debt, with many operating between five and 25 locations. The survey also revealed that one in four independent table-service restaurants said their business is not expected to recover from the debt incurred due to the pandemic unless current conditions change.