Executive Committee discusses Regina’s entertainment tax IG News

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On Wednesday, the executive committee voted to amend a nearly 100-year-old by-law that taxed recreational tickets sold in the city.

history

Since 1923, the city of Regina has imposed an “entertainment tax”. Recreational event tickets sold to patrons permitted by the U.S. had a ten percent tax rate. city ​​act.

Since its inception, the bye-law has undergone several amendments, removing certain occupations or events.

The Regina Exhibition Grounds (now called the Real District) and the Agridome (now the Brandt Center) were taxed for any events. In 1989 the allegations of those incidents were dropped from the bye-law.

In 1990, the city removed the tax on events at city-owned facilities. At the time, the city felt that revenue would be better collected through rental fees.

In 1999, the tax was removed from ticket sales for the Saskatchewan Roughriders and Regina Rams to aid organizations. Events at Mosaic Stadium now charge a 12 percent fee that the city collects for larger events.

However, since 2003, only cinemas in the city have been paying an additional ten percent.

“The tax has a complicated history,” said Michael Paris, Cineplex Entertainment’s VP of Legal and Government Relations. “It’s very problematic for our industry.”

On Wednesday the executive committee voted to reduce it to five percent.

Movie theaters and taxes

Four movie theaters in the city currently pay the tax: Galaxy Cinemas Normanview, Southland Mall Cineplex, Landmark Cinemas Aurora and Rainbow Cinemas.

Only two jurisdictions in Canada have such a tax. Including other sales taxes, the total tax was 15 percent, one of the highest in Canada.

In the 2022–23 provincial budget, the provincial government imposed an additional six percent tax on recreational activities such as concerts, sporting events or movie theater tickets starting October 1, 2022.

That PST would have raised the total tax on movie tickets in Regina to more than 20 percent, making it the highest rate at six percent.

Paris called the entertainment tax an “economic disincentive”.

“It’s especially serious in our view because it’s on theaters and only in theaters,” he said.

Paris said that cineplexes and other theaters, such as the Landmark, used to include any applicable taxes – such as entertainment taxes – in their fees. In the spring, however, it changed its policy to have face value before taxes, which the custodian could see reflected in the cost.

“It’s an overload that the consumer feels,” he said.

Rainbow Cinemas will close its doors on September 25. Count Lori Bresciani believes the city’s tax was a contributor.

“There’s only so much you can do,” she said. “We know everything affecting labor, inflation and a business’s ability to stay open. It affects everything. ,


city ​​and tax

The rate reduction brings the city in line with other jurisdictions across the country but still among the highest.

As for pre-pandemic levels, the city said the tax, which generated more than $700,000 in annual revenue, fell to just $169,000 in 2020 and climbed slightly to $219,000 in 2021.

“The entertainment tax is one of the only tax levers – outside the mill rate – that we have as a city,” Mayor Sandra Masters said.

Bresciani called the tax discriminatory because it targets just one industry in the city.

“If we want to call it entertainment tax, it should be on all our entertainment in the city,” she said. “It shouldn’t be on just one industry.”

One-tenth of the total tax is owed by cinema operators to help cover the cost of collecting the tax on behalf of the city. Paris said the cost of collecting fees at the gate is less than a tenth of what it made.

Count Bob Hawkins did not believe that removing or even reducing the tax would mean a cheaper night out for families.

“I don’t agree that people are staying away from theaters because of this tax,” he said. “Nor do I agree that if the tax were removed, the cost of movie tickets would go down.”

The city administration said it had consulted about the extension of the tax last year.

“Seeing that we were coming out [the pandemic]“We decided not to bring forward a recommendation,” said Barry Lacey, executive director of financial strategy and sustainability for the city. “I think the discussion may still be on — that’s another tax source for us — to expand that, at some future point.”

Against this, the resolution was passed by six votes in favor of three. Count Bresciani attempted to amend the bylaw to remove it entirely, but was not allowed to pass as a proposal to reduce it was still in hand.

Paris called the rate cut half a victory.

“Right now, you will see it in your local cinemas. It is unfortunate,” he said. “But the net result is not as bad as it could have been.”

The decision of the executive committee will go to the council on September 28.

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