Restaurant business in B.C. was down 10 per cent during the first month of the Harmonized Sales Tax, according to a survey by the Canadian Restaurant and Foodservices Association.
The online survey, conducted between July 26th and 31st, drew 802 responses from restaurant operators in the province.
Only three per cent reported seeing a positive impact from the HST, while 72 per cent said it was having a negative impact.
"I was hoping for the best, but it appears that the B.C. restaurant industry's worst fears were realized," CRFA Vice President Mark von Schellwitz told ctvbc.ca.
"I think now it's time for the government to step up to the plate and help our members deal with a very tough transition to a new tax."
More than half of respondents said customers were spending less on food, and 56 per cent said they had fewer customers since the tax was imposed. Many claimed they were forced to cut back on staff and hours to adjust.
The CRFA has been one of the most vocal opponents of the tax. Last year, the group launched the No Meal Tax website, which called for a provincial HST exemption for restaurant meals. A petition on the site received more than 200,000 signatures.
Finance Minister Colin Hansen says the tax will be a boon to the province, creating jobs and reducing paperwork for restaurant operators.
"It was anticipated that there would be a period of adjustment as diners encountered minor increases in the cost of the food portion of restaurant meals," Hansen said in a statement.
"It's not surprising that, in the short term, some restaurants are experiencing some changes."
Consumer confidence and a strong economy will keep the industry afloat, Hansen said.
