Representative Steven Howitt: State delivering more tax relief for local restaurants
Boston – State Representative Steven Howitt (R-Seekonk) is pleased to announce the state is offering additional tax relief measures to restaurants that have been struggling during the COVID-19 pandemic.
On June 18, the Baker-Polito Administration announced it is extending the collection date for meals tax payments until September. The extension applies to payments that otherwise would have been due between March and August of this year.
The tax delay allows businesses to defer payment on their meals taxes until September 20, without being charged any penalties or interest. Previously, the state had extended the tax deadline to June 20. Businesses that paid less than $150,000 in meals taxes for the year ending February 29, 2020 qualify for the tax extension.
“This is great news for many small businesses that were already operating on a slim profit margin before the pandemic hit and have been struggling to stay afloat under the operating restrictions the state has imposed on them over the last several months,” said Representative Howitt. “The legislative and executive branches have taken a number of steps to help restaurants, but it is critically important that we continue these efforts to support local businesses during these uncertain times.”
Between March 17 and June 7, restaurants were limited to take-out and delivery orders only, as all indoor dining was prohibited. Chapter 53 of the Acts of 2020, which was passed by the Legislature on April 2 and signed into law on April 3, allowed restaurants holding liquor licenses to begin offering beer and wine in conjunction with food takeout orders to help increase sales.
Beginning on June 8, restaurants were allowed to offer outdoor table service under Phase 2 of the state’s re-opening plan. Indoor dining service resumed on June 22, with a number of restrictions in place to ensure the health and safety of customers and workers.
Representative Howitt noted that the House of Representatives approved a restaurant relief package on June 3 that includes a meals tax component similar to the plan announced by Governor Baker on June 18. The House proposal would allow restaurants to delay their meals tax payments for the remainder of the year, without being assessed any late-file or late-payment penalties or interest, and would move payment of some meals tax collections into 2021.
House Bill 4774, An Act addressing challenges faced by food and beverage establishments resulting from the COVID-19 pandemic, sets a deadline of September 20 for businesses to submit meals taxes collected from June 1-August 31, and a January 20, 2021 deadline for submitting meals taxes collected from September 1-December 31. The bill still requires Senate approval.
Representative Howitt said House Bill 4774 will give restaurants additional flexibility to attract customers and increase sales. In addition to allowing restaurants holding liquor licenses to begin offering mixed drinks with food takeout orders, the bill provides price-gouging protections to restaurants by capping the fees they can be charged by third-party delivery service companies for online food orders.
House Bill 4774 also authorizes local licensing authorities to temporarily approve requests for outdoor table service at restaurants, with alcohol sales, through November 30. Representative Howitt said this change will allow cities and towns to bypass the current licensing review process conducted by the Alcoholic Beverages Control Commission, which typically takes 7-10 weeks to complete.
The House proposal also allows licensed establishments to continue to sell beer and wine for off-premises consumption for the duration of the Governor’s State of Emergency, or until February 28, 2021, whichever is later.