5% Meals taxes would hurt coastal restaurants

By Oregon Small Business Association,

Both Newport and Cannon Beach have 5% Meals Tax proposals on the November 2021 ballot. Newport’s tax is Measure 21-205 which would fund public safety, library, parks, facilities and other services. Cannon Beach’s tax measure is ballot 4-210 and it would fund the Fire District and a new City Hall.

Both taxes would severely hit restaurants at a terrible time. Restaurants are still recovering from a pandemic and depressed customer turn-out. Restaurants are struggling with a labor shortage, so severe, that many restaurants are being forced to to cut days and hours of operation — which means they are turning away customers. Larger chain restaurants are better able to handle the twin disaster, but the small family owned restaurants are more likely to close forever.

Many businesses are wondering why the city is not waiting until the pandemic is over to consider any new taxes.   This is our question too.

As a helpful alternative, both cities should consider broad base taxes where everyone pays their fair share for the same public benefit. Why should local small family restaurants be forced to bear the tax burden for say, public parks, and not other businesses?

High gas prices and inflation are already driving up costs for restaurants. Many meal items are increasing by more than 10%. If you add in the 5% Meals Sales Tax, then you are asking restaurants to drive up prices 15% to pay for costs that did not exists months ago.

The costs to the tax are just too great.

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