For the last five years, Angelo’s restaurant on Atwells Avenue in Providence has resisted raising prices, so owner Robert Antignano was disappointed to hear that the state might do it for him through a hike in the restaurant tax.
“For the average person at Angelo’s, this is not a good thing,” Antignano said about the proposed 2 percentage point increase in the meals tax in Gov. Lincoln D. Chafee’s recently released fiscal 2013 budget. “If they have to pay more to come out and eat, maybe they will think twice about it. Maybe they will come once a month instead of twice.”
Like other segments of the business community that have felt unjustly targeted by proposed tax increases in recent years, restaurateurs like Antignano this year are voicing their frustration with Chafee’s proposal, which would raise the tax on restaurant bills from 8 to 10 percent.
It’s one of a series of tax hikes in the governor’s budget that has made business leaders, who in other respects have been sympathetic to Chafee, uncomfortable.
In addition to raising the tax tacked onto restaurant bills, Chafee’s budget would also extend the state’s 7 percent sales tax to now-exempt transactions such as pet supplies, taxi rides, freight shipments, car washes, warehousing, storage and clothing items worth more than $175.
Chafee’s budget also recommends increasing taxes on tobacco from $3.46 to $3.50 for a pack of cigarettes and from 50 cents to $1 per cigar.
And vacation room rentals at bed and breakfasts and other establishments with less than three rooms, now exempt from state hotel tax, would be subject to the tax.
“Gov. Chafee’s blueprint for state spending in 2013 includes some laudable proposals, most notable an increased emphasis on funding education and work force development. However, the Chamber has concerns surrounding the methods identified in the budget for drawing new sources of revenue,” the Greater Providence Chamber of Commerce said in a statement.