Source: American Distilled Spirits Alliance
May 11, 2020
The American Distilled Spirits Alliance (ADSA) and American Beverage Licensees (ABL) are pleased to support the hospitality industry and call for restoration of the deductibility of business entertainment expenses under the U.S. tax code.
“Restoring deductibility for these legitimate expenses is a vital move for keeping the hospitality industry functioning in a time of crisis and will help speed their recovery post COVID,” said ADSA President Matt Dogali. “A strong restaurant and hospitality industry have a significant impact on the overall health of the broader U.S. economy. Restaurants and bars are some of our best customers, and this deduction will significantly help boost our customers’ business”
In April, the President stated during a White House briefing that he would instruct Treasury Secretary Steven Mnuchin and Secretary of Labor Eugene Scalia “to immediately start looking into restoring the deductibility of meals and entertainment costs for corporations.”
“With another week of closures of America’s bars, taverns, nightclubs and cocktail lounges, time is running out for hundreds of thousands of licensed businesses that serve beer, wine and spirits and create millions of jobs,” said ABL Executive Director John Bodnovich. “These local small business owners need any relief they can get to stay in business and restoring this deduction is part of giving them a fighting chance in the months ahead.”
The 2017 Tax Cuts and Jobs Act eliminated all entertainment expenses creating confusion as to applicability of the business meal deduction. It also missed an opportunity to stimulate economic activity between the business community and hospitality industries by improving on the deduction, which is currently 50%. As the Nation looks to economic recovery from COVID-19, a less restrictive and full deduction for business entertainment, including that which takes place in licensed beverage businesses, will support one of the most heavily impacted sector of the economy.
“Every little bit will help the hospitality industry return to sustainability,” said Bodnovich. “Bars and restaurants accounted for 60 percent of the jobs lost in March, and more losses are expected.”
“Maintaining the vitality of the hospitality industry during this difficult time will also help distillers build and promote quality spirits brands,” Dogali added. “Restaurants and bars helped cultivate a vibrant, growing, creative U.S. spirits industry. Our industry has stood ready throughout this crisis to help by manufacturing hand sanitizer for frontline health care workers, first responders, and other at-risk American heroes during the pandemic. It’s time to help our industry partners and get hospitality back on its feet.”
For more information, please visit:
www.americandistilledspirits.org