Restaurant owners are one of the many targets which the French government wishes to punish for their own mismanagement of the country’s finances.
In July 2009, a step needed for the business – and good for President Sarkozy who had the guts to do what was promised by his predecessor for seven years – has taken. After a long-fought battle, restaurants obtained a reduction of the VAT applied to food from 19.6% to 5.5%, which gave them a bit of oxygen, so to speak. In return, it was implied that the restaurants would lower their prices (so that people would frequent restaurants more often), and that they would create jobs.
After only one year – the French government having a tendency to react impulsively – this very smart decision is becoming an issue again. Yet, if we look at the just-born advantages of this stepping stone, we see that in one year’s time:
- Restaurant bankruptcies have decreased by 17%
- More than 23,000 jobs have been created.
The trend is definitely catching on!
Yet, restaurant owners are being targeted because some have not cut prices enough (meanwhile food costs rise every month for them), and others have decided to use this extra « oxygen » to better remunerate their personnel (so hard to find these days) or to hire. And some did not follow the trend because they were already near strangulation. In other words, the French government wishes to go back on a good decision simply because restaurant owners have not saved the restaurant business! This over-simplified rationale proves that there is no reasoning at all.
Food is not where the gains lie. Once you have paid the « chef », the waiter(s), the dish washer, the owner, the social charges on these people (52% above their salary), the food, the cutlery and dishes, the rent and affiliated overhead and upkeep, and all taxes, what the restaurant makes on an 18 € average dish is next to nothing and can even be a loss. We all know that the profit is made on drinks whether it is bottled water, sodas, beer and wine – items which have remained taxed at 19.6%.
At the same time, food is what makes people go to “eating places”! Restaurants play a very important social role in society. It is where people gather, where lovers reunite, where couples talk away from their cramped apartment, where large screens reunite sports aficionados, and last but not least, where people do business! Moreover, let’s salute all the restaurant owners who have the gift for creating a warm, care-free zone where one can relax – an added value we all crave.
Therefore, if people don’t go to the restaurants much anymore, it is simple mathematical logic: they are broke! After all, aren’t we in the middle of a serious economic crisis?
Of course, ministers and other high-ranked civil servants of France cannot easily appreciate the difficulties restaurants encounter since their nearby canteens, the « Laurents » and « Arpèges » are always full. But for us, the French consumers, cafés, brasseries and « on the corner » restaurants must go on. They are our oxygen.