Mandatory billing in the restaurant sector - Fight Against Tax Evasion: More
Than $2 Billion over Ten Years

MONTREAL, Aug. 30 /CNW Telbec/ - As of September 1, restaurateurs will be required to provide their clients with bills listing all the items consumed. "Ask for the bill!" said Raymond Bachand, Minister of Finance and Minister of Revenue, as he announced today the coming into force of the first in a series of measures to fight tax evasion in the restaurant sector.

"Beginning September 1, 2010, all restaurateurs must provide their clients with bills," said Minister Bachand. "By receiving a bill, clients can verify the accuracy of the information shown on the bill as well as the amounts of tax collected. As part of the next step, in November 2011, bills will have to be generated using a module that records all sales made in an establishment. The device will provide a true picture of all transactions made and amounts collected."

Over the next year, sales recording modules (SRMs) will gradually be installed in all restaurant establishments. Restaurateurs who have failed to fulfill tax obligations and new restaurateurs are being targeted first. By November 2011, all restaurants will have to be equipped with SRMs.

The Minister pointed out that "although not all the responsibility lies with the restaurant sector, losses from tax evasion in that sector are substantial. A conservative estimate shows that for the year 2007-2008 only, losses amount to $417 million. It is our duty to take aggressive action to stop this type of tax evasion at its source. I want to underscore that several associations and representatives of the restaurant industry share our concern and have actively cooperated in developing the measures now being implemented. There is no doubt in my mind that the vast majority of merchants comply with the laws, but I am also convinced that they suffer from the unfair competition created by a certain number of tax-evading restaurateurs."

The new measures will help recover more than $2.3 billion between now and 2019; this means over $300 million a year once all of the measures are in effect. To do this, the Minister of Revenue will invest a total of $117.5 million, including an $83.1 million subsidy program immediately being established to assist restaurateurs in purchasing and installing SRMs. Also, Revenu Québec will increase the recurring budget allocated for inspections in the restaurant sector by $10.5 million per year. This illustrates the great effort made by the government to fight tax evasion.

The restaurant industry is composed of some 19,000 establishments, with annual sales totalling $10 billion. An estimated 192,000 people work in the industry. The restaurant sector is a flourishing sector of the Québec economy; hence the necessity of maintaining a fair and competitive environment for all.

Tax recovery: a key element in balancing the budget

Over the last few years, the government has stated many times that it would take forceful action against tax evasion and under-the-table employment in all economic sectors. The minister stated that "as proven by the measures announced today, our actions are geared toward ensuring that each individual pays his or her fair share of taxes. Each year, tax evasion deprives the government of considerable revenues that could be used to finance public services. Moreover, this loss places an extra tax burden on honest taxpayers who have to make up the difference."

In the same spirit, the minister reiterated that tax recovery is a key element in balancing the budget: the government has mandated Revenu Québec to increase its annual tax recovery goal by $1.2 billion beginning in 2013-2014.

For further information: Catherine Poulin, Press Relations Officer, Office of the Minister of Finance, Minister of Revenue and Minister responsible for the Montréal region, 418 643-5270, 514 873-5363