CRA could investigate restaurants that fail to comply with holiday GST tax break

Just days into the federal GST holiday tax break, many businesses and restaurants are still getting the hand of things.

Jane Muir, owner of Dartmouth, N.S., restaurant La Cucina, says adapting to the federal tax break has been an operational success for them.

"It wasn't really a big adjustment,” says Muir. “A little bit of work to reconfigure our point of sale, but other than that…I think it’s been great."

Jasveen Rattan, director of policy and government relations for the Ontario Restaurant Hotel and Motel Association, says not all restaurants have been making that adjustment.

“We have heard rumours that some restaurants haven’t been complying,” says Rattan. “And from what we know regarding this, the restaurants that don't comply will be dealing with some serious financial complications when it comes to filing their taxes.

“The CRA is not going to be happy about them not complying because as far as the government’s concerned, it’s mandatory."

According to the CRA, businesses who make reasonable efforts to comply with legislation won’t be the focus of their compliance actions.

“(The CRA will) be focusing on situations where businesses willfully and egregiously refuse to comply with the temporary measures, such as a business that collects the GST/HST and does not remit it to the CRA,” the agency says.

Rattan says she doesn’t see why restaurants wouldn’t comply since the holiday break could help boost business.

“At the end of the day, (the tax break) is just an incentive for consumers to come and spend more money, right?” says Rattan. “As far as we’re concerned…the HST holiday is something that is going to be beneficial, we feel, for restaurants. We’re expecting to input about $1 billion into the economy.”

Muir says she would be “surprised if there weren’t any restaurants participating.”

“If anyone maybe missed the first couple of days, I think it was probably just an oversight. I’m sure everybody will participate,” says Muir.

Danielle Doucette, the admin and research coordinator for the Restaurants Association of Nova Scotia, says they have “not received any reports or notifications of restaurants in N.S not complying with the rule.”