On Wednesday, the city’s executive committee will discuss a potential reduction in the municipal tax, from 10% to a rate of 5%.
If approved, the committee will forward the proposal to City Council for a final vote. If approved, the change will go into effect in October, according to the revised public agenda.
The amusement tax cut would result in an estimated $350,000 in lost revenue, according to city council documents.
The City would receive the equivalent of this sum thanks to the revenues generated by the MRS (New window) (in English), the Municipal Revenue Sharing Grant from the Government of Saskatchewan.
This revenue increase is related to the Provincial Sales Tax (PST) expansion announced in March, which will also take effect in October.
Net reduction in revenue until 2025
Taking this review into account, the province believes that expanding the TVP would generate total incremental revenue of $18 millionindicates a document of the City.
It is expected that the city may receive an increase in municipal grant funding of approximately $350,000 due to the expansion of the TVPadds the City.
The City will not fully benefit from the expansion of the TVPbefore 2025, because the grant is allocated based on the money raised two years before.
Therefore, there will be a net reduction in revenue until 2025says the city.
The city administration also mentions other options that the executive committee can discuss on Wednesday.
Councilors could choose to eliminate the amusement tax altogether or retain the 10% rate.
Bad times for cinemas
The past two years have been bad for Regina movie theaters, according to the amusement tax revenue the city has received from commercial movie theaters.
This tax applies to four businesses, namely the Galaxy Cinemathe Southland Cineplexthe Landmark Cinemas and the Rainbow Cinemas.
Before the pandemic, they collected an average of $700,000 a year in entertainment tax for the city, according to the executive committee’s revised public agenda for Wednesday.
Due to COVID-19, these revenues have dropped to $169,000 in 2020 and to $219,000 in 2021.
too little too late
This potential change comes too late to Rainbow Cinemaslocated in the shopping center Golden Mile.
The company will screen its latest film on Sunday, before closing its doors for good.
At one time the Rainbow Cinemas was a very popular place for cheap entertainmentsays the president of Magic Lantern TheatresTom Hutchinson, in an email.
It was cheaper to see a movie at the cinema than to rent one at the Blockbuster. But like Blockbuster, the allure of cinema has fadedhe adds.
COVID-19, of course, accelerated this decline.
With information from Theresa Kliem