Braintree City Council will take another look at a meals tax estimated to generate $900,000 to the town.
The council has looked at the tax two times previously, each time declining to implement the 0.75 percent charge on meals, which would be in addition to the 6.25 percent meals tax levied by the state.
Yet now that the estimate of potential revenue has grown to $900,000 from $500,000, the subject might be worth another look, said Councilor John Mullaney, who has proposed the measure each time.
“It’s pretty substantial,” Mullany said. “When the council recognizes 161 towns out of 350 now have it, [and that] we rank number 24 in the sale of meals out of 350 towns [they might change their minds]. We have $121 million in sales in this town and we don’t get any of that money.”
Mullaney said the town has been losing state aid over the last several years, and that this would be a way to supplement that.
Due to concern that the money would go into the general fund, Mullaney said he plans to add an amendment to a motion that any money generated from the venture would go into capital improvements.
“If I make this town better, it will bring better consumers to the restaurants,” Mullaney said. “Braintree has improved on its streets; we’re making it better and better.”
Mullaney further said the tax would help alleviate some of the pressure from residents, who saw an increase in real estate taxes last year.
Councilors welcomed that tax increase, Mullaney said. A smaller tax, with part of it paid by non-residents, shouldn’t be much more controversial.
“If you can’t afford to pay it, you don’t go out,” Mullaney said. “Plus, this is insignificant. The owner of Southside said, ‘I raise the price of beer 25 cents and everyone jumps all over me at the bar,’…. but the additional tax, if you sell a beer at Southside for $5, [the tax] is 4 cents. They won’t jump all over him for 4 cents. That’s how trivial it is.”
Mullaney said Dave & Buster’s also didn’t care about the tax, which would not be borne by the restaurant, but passed onto the consumer.
According to Mullaney, the tax is so inconspicuous that the owner of The Common Market Restaurant in Quincy, who also owns a Yogurt Bar in Braintree, didn’t realize that Quincy had a meals tax and Braintree did not.
In other towns that have passed similar measures, the tax has had no measurable negative impact, Mullaney said.
“There is no evidence to believe that people aren’t going to go to a restaurant because of the meals tax,” he said. “What happens is restaurants are a destination location. There are very few people that will say because of three-fourths of one percent we’re not going to that restaurant.”
Yet for Michael Wilcox, chairman of the Braintree Chamber of Commerce, the problem is the money is coming out of the local economy.
“That’s $900,000 that’s taken out of the local economy with people that are already pre-disposed to spend that money in Braintree,” Wilcox said. “That will have a local impact on our businesses.”
Wilcox stressed that the budget is a communitywide problem, and trying to solve it within the restaurant business disproportionately places the burden on one industry.
Even more troubling is the fact that only 30-40 percent of people paying the meals tax will be from out of town, meaning that 60 percent of the money will be paid by Braintree residents, he said.
Wilcox, along with a dozen or so business owners and chamber members, came to the Braintree Town Council meeting on Tuesday night to show their opposition to the bill, even though the measure won’t be discussed until a future meeting of the Ways and Means Committee.
Wilcox implored the council to think about the ramifications in the meantime, and keep the local business people in mind.
“A .75 percent increase represents a 12 percent increase on the existing sales tax – when you add that to the governor’s increase of 1.25 percent in fiscal '10, overall it’s a 2 percent on top of the [previous] 5 percent. That’s a 40 percent increase. Where is the tipping point?” he said.