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NRA issues statement on small business tax package
February 12, 2007
WASHINGTON, D.C. — The National Restaurant Association has issued a statement on the House of Representative's small business tax package. On Monday, the House Ways and Means Committee passed legislation which would provide $1.3 billion in tax breaks to small businesses to help offset a proposed minimum-wage increase.
The Senate's version of the minimum-wage bill included $8.3 billion in tax offsets. Both bills must be reconciled before going to President Bush for his signature.
"The National Restaurant Association is appreciative that the House Committee on Ways and Means bill includes a provision to ensure that Congress does not impose a FICA tax increase on employers as part of a mandated wage increase, however we are disappointed that it does not include a provision on accelerated depreciation for newly-constructed restaurant buildings as the Senate bill did last month," said outgoing association president and chief executive officer, Steven C. Anderson.
"After the last federal wage hike in 1996, the restaurant industry lost more than 146,000 jobs and operators postponed plans to hire an additional 106,000 employees. The impact in our industry is acute, and it is vitally important to protect restaurant jobs," Anderson said."Inclusion of FICA tax credit and restaurant depreciation ensures that both segments — table service and quick service restaurants — of the industry that employs the most minimum wage earners are assisted in order to minimize job loss."
In nationwide surveys conducted in October 2006, restaurant operators reported that they plan to take a number of actions if the federal minimum wage was increased from $5.15 to $7.25 over the course of 30 months:
Survey results include:
- 98 percent of quick-service operators said they would increase menu prices, compared to about three out of four family-dining and casual-dining operators.
- Roughly one-half of restaurant operators said they would reduce the number of employee hours worked.
- Approximately one out of four restaurant operators said they would postpone plans for new hiring if the federal minimum wage rose to $7.25 over the course of 30 months.
- Approximately three out of 10 restaurant operators said they would cut employee benefits.
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