The Citizen, 1991-01-16, Page 12PAGE 12. THE CITIZEN, WEDNESDAY, JANUARY 16, 1991.
Local businesses struggle with GST headaches
BY BONNIE GROPP
Now that GST is a couple of
weeks old, how are area businesses
coping? Has it been as confusing as
they had anticipated? Is it an
administrative nightmare and how
are consumers reacting?
For Rene Richmond, owner and
operator of Just For You Gifts and
Flowers in Brussels, the arrival of
January 1, meant completing an
entire inventory then marking
everything down. Mrs. Richmond
also decided to offer all her stock at
an additional 10 per cent discount.
“I was trying to make it better for
my consumer,” she said. “Adding
the GST was something I had to do.
but I knew it would be harder for
people. I guess I have been a
consumer too long. That’s why 1
put my prices down.”
Due to incentive offered by the
discounts, Mrs. Richmond hasn’t
noticed a lot of negative reaction.
“It is not as bad as I had
expected,” she says. “1 seem to be
as busy as ever, but people are
definitely watching, they’re more
cautious. Next month will tell the
Long service
tale when my sale is over.”
Jayne Marquis of Bainton’s Old
Mill in Blyth is very outspoken on
her feelings concerning the GST.
“It hasn’t been difficult to imple
ment, but I see it as a disastrous
move for the government to make
at this time. I don’t agree with it;
sales have been hurt and it’s got to
harm our economy.”
Ms. Marquis said she also can’t
see prices going down as many
have promised, but notes that at
least with this tax people know
what they are paying. “At least
this one in on the table, not hidden,
but people have to learn to stop
paying these imposed taxes. We
are already taxed 50 per cent of our
income.
Consumers she has dealt with
have been, she said, for the most
part negative towards the tax.
Rob Raymond, co-owner of J. L.
McCutcheon Ltd. in Brussels said it
has taken him and the rest of the
staff 10 days to better understand
and adjust to the new tax. “We had
been to workshops and seminars
and thought we were pretty well
prepared for GST, but until you get
down to it in the practical sense you
have no idea what to expect.” said
Mr. Richmond.
One thing he does know is that
they have to charge GST on
virtually everything. “Every bolt,
nut and car we sell we have to
charge GST on.” To prepare for the
tax a physical inventory had to be
done to apply for the Federal Sales
Tax rebate. The gas had to be
checked and counts done on tires,
stock and vehicles on the premises.
He has, he said, been amazed at
consumer reaction. “Everyone
talks about it and complains a little,
but most just smile and under
stand.” He adds that GM warned
its dealers to tell people the truth
when they are paying for some
thing and show them if possible
where they are actually paying the
money.
Mr. Richmond said the addition
al costs in “astronomical extra
hours” has not been the biggest to
the company. All of the used cars
on the lot were lowered seven per
cent for which McCutcheons will
receive compensation from the
government of about three per
cent. “These don’t make any
difference to the consumer in
savings and it costs us. The only
one winning is the government,”
he says. Mr. Richmond also says
the private auto dealer is putting
additional burden on businesses
like his. They can sell them chaper,
but they don’t have to pay the other
social benefits we do. Frankly, I
think it’s criminal. Either pay the
fair share or be out of the used car
business.”
For Allan Teeft and the staff of
EMA the transition has been
accomplished very smoothly, due
he says to the costly equipment he
purchased about four months ago
in anticipation of the tax. “When
we opened on January 1 everything
had been programmed into the
computers so it was very smooth.
They were a big investment he
said, but one he believes was worth
it.
Mr. Teeft says the integrity of
the computer programming is such
that consumers see what they pay
GST on and they know it’s accur
ate. “Whether they’re happy with
GST or not, they can see what they
paid it on and they know that there
haven’t been any mistakes made.”
“As well,” he said, “When he
opened on January 1, there had
already been 2,000 price changes
done and we were ready to pass
these savings on to them immedi
ately”.
Ron Clarkson of Brussels Village
Market and Brussels Variety
agrees that consumers haven’t
made any serious complaints when
purchasing goods at either of his
stores. “There has been a bit of
grumbling but nothing serious,”
he said.
Mr. Clarkson said there has been
a little work involved in getting his
stores ready but nothing that he
wouldn’t have been doing at this
time of year anyway. The only
thing he thinks is a little “tricky”
with the tax is that they didn’t put
it with the existing provincial sales
tax and split the two by a percent
age point.
“The big thing we’re finding,”
said Don Scrimgeour of Knechtel’s
in Blyth “is that even with the toll
free information numbers we’re
still getting conflicting answers or
no answer at all. “I’m sure there
will be all kinds of problems
cropping up that no one has the
answer for. When dealing with a
specific problem recently, he was
told’ by the information service to
leave it with them and they’d get
back to him in a week or so. “It was
for a gift basket so that really
wasn’t much help,” he said. “I’m
sure they’ll iron everything out in
time or we’ll just use common
sense to solve the problems our
selves. We’re into it now and
consumer reaction has been better
than I expected. We’ll just have to
live with it.”
For another area business, living
with this tax is unlike anything they
have ever dealt with before and
effects and impact on the industry
are still unknown. “It is a night
mare for Arts in general,” said Joel
Harris, General Administrator of
Blyth Festival. “We know there
will be tremendous administrative
costs but it is hard to gauge as yet if
it will affect ticket and voucher
sales. Things are slower right now
in general and I have a feeling it’s
going to be a bad dream if not a
nightmare,” he said.
How the tax will apply to actors
is another area that is unclear.
“The government tried to provide
information but it was sketchy.
Some people in the arts are
considered self-employed while
others aren’t. “Many will have to
hire professionals to deal with the
book work. I see this tax as an
absolute boon to accountants,”
said Mr. Harris.
“With the recession taking hold
and government money frozen it
looks like a hard financial year to
deal with the changes without some
help to loosen the strings,” he
said, adding “and without having
the consumer pay.”
He agrees that even the ieform-
ed are uninformed saying that calls
to the GST hotline and Revenue
Canada usually net different an
swers. “We’re already getting
calls we don’t have the answers for
and can’t find anyone who does.”
Realistically, Mr. Harris notes
that the pleasure business will be
the first to go, if consumers decide
to cut back. “Someone will say,
'Well I saw five plays at Blyth last
year and this year I think I’ll only
go to four.’ That doesn’t sound like
much but for us it’s a 20 per cent
drop. ‘Consumers are going to be
more careful so time will tell what
the affect on us will be,” he
finished.
On Thursday, December 20, Robin Dunbar presided over his
final meeting with the 1st Brussels Scout Troop. Scouter
Dunbar has been active in Cubs and Scouts in the Saugeen
West District for 10 years. His dedicated service to Scouting
was recognized with the presentation of an appreciation
plaque by District Service Scouter, Bob Hewines. - Photo by
Ross Hemingway.
EXTRA EXTRA
East Wawanosh appoints
county weed inspector
Continued from page 1
to destroy harmful weeds on any lot
in a plan of subdivision or on lots
smaller than 10 acres in size.
A user fee agreement was signed
with the Wingham Recreation and
Community Centre Committee.
Reeve Ernie Snell declared a
conflict of interest concerning the
preliminary report on the proposed
plan of subdivision at Part Lot 42,
Cone. 9 by Snell Investments Ltd.
Council approved the report as it
conforms to the secondary plan and
to the zoning by-law. Council felt
the proposed use for the land was
appropriate with the only concern
being for erosion control on the
road allowance of one part of the
subdivision.
A recommendation was made
that the province purchase the
abandoned Goderich-to-Guelph CP
Rail line lands. Council also favour
ed the water line concept for the
land.
A livestock claim in the amount
of $130 for ducks killed by dogs w as
paid.
Council passed a motion to apply
for supplement allocation in '91 for
the purchase of a new road grader.
A public meeting was held
regarding the proposed official
plan amendment to add policies to
permit one temporary mobile home
for family members only (parents.
sons or daughters) on property
zoned agriculture. There were no
objections raised to the proposal so
a recommendation for approval by
the county was made.
Howto be
a Local Hero
Ask . When you want to
make your community a better
place, but don’t know where to
start, ask your friends. Chances
arc, many of them are already
Local Heroes, giving their time
and money to causes that
you can help
. too. Be a w r.%
Local Hero.
A new spirit of giving
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