Thursday, June 11, 2009

An egregious miscarriagement of taxitude*

Higher state taxes on spirits and wine? Passed on by restaurants to the consumer? Faint ...

There's been a bit of backlash by consumers with QWERTY access, teeing off on restaurants, posting complaints about the threat to pass on a 25 percent increase in those taxes.

It's pretty much misplaced blame to do that. Here's why:

Restaurants don't stay in business by losing money; nor can they eat every rise in their overhead. Last year, anything made with flour cost more because of stupid government policy skewed toward corn as the raw material for ethanol (more corn planted, less of wheat and barley); delivery charges went up when crude oil prices (futures prices, that is) hit the moon; and the list goes on.

The places you dine at were doing what they could last year to manage those headaches. And their migraine has lingered into this year with a downturn in business that they're struggling to make up. (Consider this: You should support your favorite restaurants if you can. The patrons they stand to lose aren't just someone else; they are you, too, if you're staying away in protest.)

So when New Jersey, meaning the Corzine administration, popped the cork on this tax increase and poured everyone a round of pay-more, well anyone who had just finished a snifter of Courvoisier on March 10th could have envisioned restaurants being stuck with few options.

And if you're a beer drinker, don't think you're getting an automatic pass at the tap just because beer was left off Corzine's tax menu. To keep from scaring away patrons, restaurants and bar owners could spread the pain across the pricing board – pints of beer, entrees, appetizers – and not just jack up the tab for a shot of Applejack. (It makes for good, kneejerk rabble rousing for industry groups to insinuate that prices by the drink will rise in proportion to the tax increase.)

But the point remains: Don't blame the restaurant owners for trying to stay in business. Blame the Legislature and a succession of governors on both sides of the political aisle for missteps and miscues, and a legacy of avoiding doing what's right.

* From The Simpsons, 9th season, episode 20, The Trouble With Trillions

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