The Canadian Restaurant and Foodservices Association (CRFA) has submitted eight proposals to the B.C. Liquor Policy Review now underway – from allowing licensees to buy alcohol directly from private stores to giving them flexibility to offer customers ‘Happy Hour’ specials.
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CRFA’s top two recommendations for modernizing B.C.’s liquor policies are to move to a flat-tax markup system that offers licensees a wholesale discount and a streamlined liquor licensing system.
1. No more arbitrary liquor sales taxes: replace the existing liquor tax structure with a flat tax markup for wine and spirits, aligning these products with the existing tax structure for beer.
2. Implement a 16 per cent wholesale discount to licensed establishments and increase the licensee retail discount to 20 per cent. This will make government revenues more predictable with less risk and will relieve squeezed profit margins for businesses. It will also bring down prices, which are considerably higher than Alberta and Ontario.
3. Abolish the practice of dividing liquor license applicants as “food primary” (restaurants, ballrooms, venues) or “liquor primary” (bars, nightclubs). This is an outdated regulatory system as many modern hospitality concepts do not fit into one category or another. It should be replaced with a single licensing system that runs on a risk-based assessment, as is used in Alberta and Ontario.
4. Give the provincial government the full control and decision-making authority to grant and dictate the terms of a licence to sell and serve alcohol like in other Canadian provinces as opposed to sharing control with municipalities.
5. Allow licensees to buy alcohol directly from private retailers at quantities and prices negotiated by them, not to be restricted to purchasing only from the provincial government’s Liquor Distribution Branch.
6. Allow licensees to transfer liquor inventory from one licensed location to another.
7. Permit use of liquor pre-mixing machines for liquor menu items like slushy drinks and Sangrias.
8. Allow licensees to adjust liquor prices during the day (to enable “Happy Hour” specials) as long as they remain above the minimum price.
“There are many areas for improvement when it comes to B.C.’s liquor policies, but our members tell us that liquor costs and regulations are the biggest obstacles to maintaining and expanding their businesses,” said Mark von Schellwitz, CRFA’s Vice President, Western Canada. “To address these concerns, we are urging the B.C. government to implement a 16 per cent wholesale licensee discount, and replace the outdated liquor/food primary licensing system with a simpler, risk-based single licence system as in Alberta and Ontario.”
CRFA’s submission shows these recommendations can be implemented without eroding government liquor revenue. “In addition to providing economic advantages, a flat-tax model better reflects social interests while offering more flexibility, transparency and future liquor revenue predictability,” said von Schellwitz.
The current licensing system also discourages investment and job creation in the province. “Modern hospitality industry concepts do not fit neatly into a food primary or liquor primary category,” said von Schellwitz. “We can no longer afford to turn away millions of dollars in investment and thousands of jobs due to an overly complex, expensive and time-consuming licensing system,” said von Schellwitz.
British Columbia’s $10-billion restaurant industry is one of the largest employment- and revenue-generating liquor stakeholders. It directly employs more than 166,000 people in every community across the province.
To read the CFRA’s full recommendation, click here.
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Source: CFRA | Image: bogdanhoda / Shutterstock