Some high profile Canadian retailers have banded together to lobby the federal government to allow international tourists to apply for tax breaks on purchases of goods while on holiday.
Aldo Group Inc., the Montreal-based shoe seller, is one of the members of the Alliance for Visitors Tax Refund.
The Financial Post is part of Postmedia Network Inc. There was an issue with signing you up. Try again.
The Retail Council of Canada and Triple Five Group are also part of the group. Retailers should be able to exempt tourists from sales taxes at the till or visitors should be able to get refunds at customs using dedicated machines, according to the companies that wrote to the Tourism Minister. Switzerland's Global Blue Group Holding AG is the only non-Canadian entity in the new retail alliance.
According to Jean-Christophe Bedos, president and CEO of Birks, the European Union, Asian countries and all over the world are using the visitors tax rebate as a competitive advantage. Canada is at a disadvantage due to the fact that it hasn't got that system in place.
Canadian retailers have been hurting since the start of the Pandemic, dealing with labour shortages, high inflation and subdued consumer spending. Retail sales fell in July from June. The agency usually gathers about half the data for its final print, but early estimates show a 0.4 per cent increase for August.
Bedos said the rebate would provide a boost to the sector by attracting tourists to shop in Canada and increase retailers' sales, as well as benefiting other companies that benefit from tourism. A study commissioned by the alliance found that the number of visitors would increase by 193,000 and that the revenue would increase by $400 million. An additional 32,100 jobs could be supported by increased spending in the travel and tourism industry, according to the study.
Goods imported to Canada are subject to the Goods and Services Tax, according to a Boissonnault spokesman. The tax is more efficient, simpler, and lower when applied to a broad base of goods and services. Gabriel Felcarek said in an email that a former rebate program was discontinued in 2007, because it wasn't cost-effective.
The federal government used to have a program similar to what the retail alliance is trying to get, but it was scrapped in favor of the foreign convention and tour incentive program.
I have worked for the jewellery industry in the U.K. and France before so I know how it works. Bedos said he saw the advantages of it.
Stores can use a third-party provider of tax refunds to collect and analyze data. Bedos was able to use that as an advantage when he was in France.
Bedos said that they used the data to organize their marketing and PR plans according to what they could expect. If we didn't have that information, we wouldn't be prepared to welcome them.
The email is bbbharti@postmedia.
All Rights Reserved © 2024
