Saturday, April 11, 2020

President Trump urged Congress to restore the full tax deduction for businesses spending money at restaurants and on entertainment

View this post on Instagram

President Trump on Friday again urged Congress to restore the full tax deduction for businesses spending money at restaurants and on entertainment, in hopes of boosting industries that have been among the hardest hit by the coronavirus pandemic. ⁣ ⁣As part of the 2017 Tax Cuts and Jobs Act, which slashed the corporate tax rate to 21 percent, Congress eliminated the corporate tax deduction for entertainment expenses. Businesses could no longer deduct up to 50 percent of expenses for things like golf outings or sports tickets under the new tax law. ⁣ ⁣But, according to the Internal Revenue Service, taxpayers were allowed to continue to deduct 50 percent of the cost of business meals with clients if “the food or beverages are not considered lavish or extravagant.” ⁣ ⁣The deductions tend to favor higher-end restaurants, the part of the industry that’s been hardest hit by the economic dislocation. Mass-market eateries and fast food and pizza chains have been more likely to hold things together with takeout and delivery business. ⁣ ⁣Restoring the dining deduction could help at least the tonier part of the restaurant industry — but down the road and depending on the strength of the recovery and consumer spending, some experts believe.

A post shared by Fox Business (@foxbusiness) on