Gov's Proposed Meals Tax Is No Solution
Peter Christie
Recently, Governor Patrick called for the legislature to create a 6 percent meals tax and to allow an additional 1 percent local option tax for meals eaten at restaurants. The intent is to provide funding for local cities and towns in these times of state cutbacks.
This is a bad idea that singles out an industry already reeling due to the economic downturn. This is exactly the opposite of what is needed to stimulate our economy.
There is no “meal tax” in Massachusetts. Meals eaten away from home are subject to our state’s 5 percent sales tax as are tangible goods and services. To single out meals eaten at restaurants for a tax hike, while leaving out every other item that is subject to sales tax, is blatantly unfair. Should your meal be taxed at a greater rate than a flat panel TV or a diamond ring?
A Troubled Industry
During a time when consumer confidence has hit an all-time low, restaurants have seen sales plummet. Throughout 2008, they experienced wholesale food price increases the likes of which had not been seen in 29 years.
Energy costs increased more than 10 percent at a time when the market pressured restaurant owners to avoid an increase in menu prices for fear of losing customers. Many restaurants have gone out of business, and there will be many more.
The citizens of Massachusetts should revolt against this proposed 40 percent tax increase on the food that they eat away from home. Eating out isn’t all luxury dining. We eat out because of our extremely busy lifestyles, grabbing a bite while on the go. It is less expensive for many patrons to eat out than it is to prepare meals at home.
Restaurants are the cornerstones of many communities and neighborhoods.
They support countless charities and civic organizations. They provide career opportunities for many. They are labor intensive with small profit margins and are owned and operated, for the most part, by members of the community — good men and women who work as hard as anyone I know.
Our industry employs about 9.5 percent of the workforce in the commonwealth and, through the sales tax on meals, collected more than $640 million dollars during the 2008 fiscal year. Now is not the time to add a tax disincentive.
Instead, the administration should invest in them as they have suggested doing for emerging industries. They should not be singled out for a 40 percent tax hike.
The Mas-sachusetts Restaurant Association is sensitive to the economic crises that many cities and towns are facing. However, if the commonwealth needs the money as badly as it says, it should levy a small increase on all sales taxes and not single out any one industry. The problems that we collectively face are too big to be seeking the solutions from one industry.
Peter Christie is the president and CEO of the Southborough-based Massachusetts Restaurant Association. He can be reached at pchristie@massrestaurantassoc.org.
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