Updated March 5 at 6:05pm

Taxing the hand that feeds state economy

'This would be nothing less than a tax on food.'

Restaurant Row is under attack by seemingly the last group of people they would suspect. In its all-consuming zeal for revenue, the governor and General Assembly have in their sights one of the few flourishing industries in the state. More

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HOSPITALITY

Taxing the hand that feeds state economy

'This would be nothing less than a tax on food.'

Posted:

Restaurant Row is under attack by seemingly the last group of people they would suspect. In its all-consuming zeal for revenue, the governor and General Assembly have in their sights one of the few flourishing industries in the state.

By including in the proposed budget for the coming fiscal year an increase in the state meals tax that would add a total of 10 percent to the cost of a meal, the governor and legislature are putting the state’s vibrant restaurant industry in jeopardy.

Restaurant owners have mobilized behind the Rhode Island Hospitality Association and have demanded that this proposed tax be removed from the state budget, as well they should.

Right now the sales tax is 7 percent and the meals tax is 1 percent. Chafee’s budget would take the meals tax to 3 percent, which would make the total combined tax 10 percent. The tax is charged at restaurants, takeout counters, for prepared foods at supermarkets and for catered dinners at weddings and functions - ironically enough including political dinners.

The hospitality association and its board of directors are on record in opposition to the proposal. The association has stated that the tax increase “will place an undue burden on local businesses, and put the state at a competitive disadvantage.”

In media accounts of the opposition by the restaurant community in rallies and protest marches, including a “tea party” that attracted worldwide media attention, the focus has been on the impact to the industry.

There is another aspect to this proposed tax that has not been reported on.

Forty-nine cents of every dollar that you and I spend on food is spent on prepared meals, cooked for us at a restaurant or takeout counter. According to the National Restaurant Association, this figure has doubled over the past 50 years. Due to the changing of the culture over the years, particularly the necessity of two-income families and the resulting demand on our time, there is far less home cooking being done. Families are being fed today by restaurants, including prepared foods from supermarkets and delis.

27~04, 043012 HOSPITALITY, food service, hospitality & tourism, services, hospitality, Rhode Island Hospitality Association, Gregg’s Restaurants, The Fifth Element¸, food service, hospitality & tourism, services, opinion, , 27~04, ISSUE43012EXPORT.pbn
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