Thank you, Mr. Chair.
Good afternoon, everyone.
My name is Satinder Chera, and I'm the incoming president of the Canadian Convenience Stores Association. I'm joined today by my colleague the outgoing president, Alex Scholten.
This year's pre-budget process asked respondents to discuss their ideas for improving the lives of Canadians, communities, and businesses. I wanted to briefly highlight how Canada's convenience stores contribute in all three areas.
Our stores help Canadians by providing employment opportunities to more than 225,000 individuals across the country. We support communities by providing essential consumer products in urban, rural, and remote locations. Our sector is the face of small businesses, with over 26,000 retail locations serving more than 10 million Canadians every day. In 2015 alone, Canadians purchased more than $56 billion in goods and services from our stores, resulting in over $21 billion in tax revenue for governments.
Our pre-budget recommendations for 2017 are focused around three challenges facing our industry.
I will start with credit card swipe fees, which remain for Canada's small businesses among the highest in the world. Credit card fees for our retailer members range from 1.5% to 4% on individual purchases. In other countries, such as Australia and the European Union, there are specific hard caps in place to support small business. We believe that lower credit card fees not only have a positive impact on businesses, in that they allow them to free up additional revenue to support their businesses, but also help consumers, who presently bear the costs as businesses are forced to increase their product prices.
That's why we're calling on the Government of Canada to reduce these excessive swipe fees by introducing caps that are in line with what other countries have done. To that end, we would like to thank the Minister of Finance and MP Linda Lapointe for their recent efforts and commitment to review this issue and land on a fair and equitable solution.
Another challenge facing our stores is what we believe to be unnecessary and costly regulations, specifically the proposed plain packaging requirements for tobacco products. At present there is a plethora of tobacco control requirements that our retail members are tasked with implementing—stringent age-testing requirements, restrictions on advertising and promotion, display bans, and graphic warning labels.
All of these regulations together have had a positive impact in reducing youth tobacco consumption rates, which recently Health Canada through its surveys found were at an all-time low. Make no mistake, our association and our retail members strongly support efforts to prevent young people from accessing tobacco products, and we will continue to work diligently with our members and with our partners in government in this regard.
That being said, we do not believe that the proposed plain packaging requirements will have an impact on youth consumption rates. If you were to review the impact of such regulations in the only country in the world that has implemented similar requirements, Australia, what you'd find is that youth tobacco rates have not changed since the requirement was introduced. What has changed, however, is the negative impact on retail operations. Retailers are struggling with inventory control, staff training, and customer transactions, all of which have increased costs for retailers without any of the accompanying consumption reduction benefits.
Lastly, our association supports the government's commitment to reduce Canada's small business tax rate to 9%. We believe the lower rate will free up additional revenue for businesses to invest in their business, to train their employees, and to provide the best possible service to their customers. In this regard, we would like to see the reduction implemented as soon as possible.
To support the government's desire to promote healthier product choices for Canadians, we are also recommending tax incentives designed to help Canada's convenience store operators purchase, store, and sell fresh fruits and vegetables in a more effective manner. We would be more than happy to support the government on this going forward.
Thank you. We would be happy to take any questions you might have.