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New Bill To Hike Tax Deductibility of Business Meals

H.R. 3333 Would Increase The Deductibility of Business MealsA bill was introduced to the House of Representatives recently that proposes to increase the percentage of a business related meal that can be deducted from 50% to 80%.  The bill, sponsored by Rep. Neil Abercrombie (D-HI), has twice been introduced in past sessions of Congress and has twice failed to become law.

Opponents say the bill will reduce tax revenue for the federal government in a time when deficits are running extremely high.  Proponents of the bill say the increased business that results from the bill will more than recoup any tax loss and help drive job creation in the United States’ largest single industry: food service.

The National Restaurant Association (NRA) has already voiced its support for the bill, citing its own research, which found that the deduction hike would spur $6 billion in annual sales for the restaurant industry.

Business related meals used to be 100% deductible until they were decreased by Congress to 80% in 1986 and then to 50% in 1993.  The restaurant industry has been lobbying for a restoration of the previously high level of deductibility since.  This bill, H.R. 3333, has been referred to committee and awaits their vote before it goes before the entire House of Representatives.

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Obama Fried Chicken Stand To Change Name

Politically incorrect?  Or just an immigrant's attempt to honor the President?

Politically incorrect? Or just an immigrant’s attempt to honor the President?

A fried chicken stand in Brooklyn, NY changed its name recently from Royal Fried Chicken to Obama Fried Chicken in honor of the United States’ 44th President.  The stand’s owner, who remained anonymous but was represented by employee Mohammed Jabbar, thought the renaming would celebrate President Obama’s election and create goodwill in the neighborhood.

Unfortunately, many community organizers and activists aren’t on the same page with Jabbar, who is an immigrant.  Within days after the fried chicken stand’s new signs went up, Jabbar started receiving complaints that the new name was offensive and racist, and reinforced stereotypes about African-Americans.

Brownsville, the Brooklyn neighborhood where Obama Fried Chicken resides, is made up of primarily minority populations.  Reactions on the street were mixed.  Some didn’t see the big deal with the new name.  Others thought it was extremely offensive.

Obama Fried Chicken’s competition, located right across the street, has taken advantage of the controversy by attracting customers who are offended by the name.  Obama Fried Chicken has promised to rename themselves soon, and Jabbar can’t wait for it all to blow over.

In the end, it appears to have been an honest attempt to honor President Obama, although a White House spokesman did say that the Oval Office has long looked down upon attempts to use the President’s name for commercial purposes.

It’s also a strange phenomenon to see new immigrants who are unaware of America’s troubled past offending older minority groups like African-Americans without realizing it.  And it appears that political correctness has won out again.

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Will Congress Pay For Healthcare Reform With A Fat Tax?

A National Tax On Fatty Foods?As Congress grapples with the costs of tackling health care reform, a couple ideas have floated to the surface to help fund the effort.  As I mentioned recently, a national tax on soft drinks was the subject of a national feasibility study and it was determined that such a tax could raise a significant amount of revenue while combating the obesity epidemic at the same time.

Now the idea of a national tax on fattening food has also arisen.  Again, the idea is to improve the health of the nation through economic incentive while raising money for health reform.  As should be expected a large segment of advocacy and lobbying groups are up in arms about the idea, including the National Restaurant Association and the American Beverage Association.  They decry the burden placed upon the little guy who is simply trying to enjoy a few simple pleasures in life: a good meal and a soda to wash it down.

For the food service industry, both of these taxes will force restaurateurs to raise prices, which explains the NRA’s opposition.  Opposition to the food tax proposals also point out the likelihood of a high rate of recidivism (meaning poorer people, who tend to eat fattier foods and disproportionately drink more soda, will carry the largest burden).  Of course, such a tax would probably help discourage the lower income people from eating unhealthy foods, and would insure them with a public health coverage plan.

Neither a fatty food nor a soda tax has made it onto any of the health care reform legislation currently being considered in Congress, and at this point their inclusion does not seem likely.  That probably comes as a relief to the NRA, but don’t expect the restaurant industry group to sit back.  They have joined the Americans Against Food Taxes lobbying group, who plans to push hard during the upcoming congressional summer recess to ensure any tax on food or drink doesn’t make into health care reform legislation.

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“Zion Curtains” Come Down In Utah

The liquor laws in Utah have always been bizarre.  From requiring membership in “private clubs” to drink local microbrews to no Sunday beer and liquor sales to limiting beer to 3.2% alcohol content, the requirements placed on restaurants, bars, and liquor stores have always been more stringent than in other states.  But the barriers state senator Michael Waddoups asked state liquor commissioners to require in restaurant bars were just too weird, even for Utah.

Nicknamed “Zion Curtains,” these barriers were placed on restaurant bar countertops to prevent minors from seeing alcoholic drinks being mixed.  Nothing was allowed to pass over these barriers, not drinks, not food, not even a napkin or a bill.  Instead, the bartender had to hand things off to a server, who brought things around the barrier to the customer.  Needless to say, out of state customers required a lot of explanations when they sat down and ordered a beer or a drink.

Implementation and enforcement of the Zion Curtains was so difficult that Waddoups was forced to introduce legislation earlier this spring that removed their requirement.  However, the bill wasn’t all concession for the conservative Republican.  New restaurants from here on out will not be able to store or mix alcohol in their bars (which kind of defeats the purpose, doesn’t it?), and minors will not be allowed to linger in or near restaurant bars.  Existing establishments will at least get to keep their bars stocked with a grandfather clause.

At least customers can get their food served straight over the counter again.  Relieved restaurant  owners tore down their barriers with some enthusiasm earlier this week.

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Card Check Unionization Bill Stirs Up Controversy

The Employee Fair Choice Act Is Under ConsiderationThe list of opponents to the Employee Fair Choice Act (EFCA) is a long who’s who of business in the United States, including the Chamber of Commerce, nationally known corporations like Home Depot and Walmart, and most notably for those in the food service industry, the National Restaurant Association (NRA).

What is EFCA? It’s a law that would allow employees to form a union at a place of business if a majority signed a card voting for unionization.

Current legislation requires that a secret ballot administered by the company must result in a majority vote for unionization.

Many small businesses would remain unaffected by the new legislation, since the minimum requirement for unionization is a business with $500,000 in gross annual revenue or at least 3 non-supervisory employees.

What’s the big deal? Well, both sides claim that coercion is the problem.

Business owners, including many in the restaurant industry, represented by the NRA, claim that employees will be coerced into signing card checks for unionization by union activists, especially since the card signing occurs in public.

Union supporters say the coercion that goes on currently under the secret ballot procedure is the real inequity in the system.

They say businesses routinely intimidate and even fire employees that push for unionization leading up to a secret ballot vote, and even though these practices are illegal, the penalties are not very harsh and are not regularly enforced.

Needless to say, Democrats support this legislation and Republicans oppose it.  President Obama spoke in favor of this bill on the Senate floor last year and its passage was a routine campaign promise last fall.

EFCA already passed the House of Representatives last year on a strict party line vote but could not attain cloture in the Senate.

With Democrats ever closer to the magic number of 60 in the Senate, the Employee Fair Choice Act is looking more and more like it will become law, probably within the first six months of this year.

The NRA’s opposition to this bill is explained as a defense of worker’s rights to a secret ballot.  They also say that EFCA will hurt small businesses.

With the passion on both sides running high, it’s hard to say who will benefit the most from this bill.  Both proponents and opponents claim to be defending workers’ rights.

In the food service industry, the leading association has taken a tough stand against this bill, but that doesn’t mean everyone agrees with the NRA.

The reality is that most restaurants will remain unaffected by this legislation because of the minimum requirements for unionization.  The ones most at risk, like national chains, are the most vocal opponents driving NRA action.

Tell us what you think about card check legislation!  Leave a comment below.

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The Obama Room Angers Restaurant’s Patrons

The Anaheim White House, a fine dining restaurant in Anaheim, CA, drew an unexpected amount of criticism recently after renaming one of 12 presidential-themed private dining rooms the Obama Room.

Irate customers asked to be removed from the restaurant’s email list and others swore they would never patronize the restaurant again as a result of the renaming.

The Obama Room at the Anaheim White House Restaurant

The Obama Room at the Anaheim White House Restaurant

The White House is located in a solidly Republican district, which may explain some of the anger.

But owner Bruno Serato pointed out that naming other private dining rooms after Democratic icons like John F. Kennedy and Jimmy Carter didn’t result in such a negative response.

The restaurant even rechristened the unpopular George W. Bush room for Jacqueline Kennedy Onassis without much complaint.

And angry diners could always opt for the Reagan or Nixon room if the Obama room isn’t to their liking.  For some reason the Obama Room has really stirred up a negative response.

Regardless, Serato remains determined to keep the Obama Room.  He says the historic nature of the last election is too important to ignore, even if a few customers are angered by it.

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