Business Meals Are a Legitimate Deduction

Michael Sanson

There are not many people who use your restaurants more than I do. For purposes of this editorial I've been keeping a log lately about my reasons for dining out. The top one is pure amusement. It's how I recreate. I know I should take up jogging or racquetball, but neither is as much fun as laughing it up while dining out.

Next is nourishment. I'm simply too tired to go home and cook and, coincidentally, so is the lovely and talented Mrs. Sanson.

Third reason: Survival. It's a helluva lot safer when you cook and the exceptionally beautiful Mrs. Sanson does not. Did I mention how charming she is?

Next on the list: Catching up. My oldest daughter, Jennifer, is now 24 and my youngest, Angela, Is 20. They've got priorities . . . mostly their friends. The good news is that their friends don't go to the cool restaurants where I eat because they're usually broke. At least once a week I'll get the call. "So, Dad, what are you doing?" Translated: "So, Dad, where are you taking me out to eat?"

Also in the top five reasons for dining out is business. There are plenty of deals to be made, my friends, and there is no better neutral territory to meet than in a restaurant. But no matter why I'm in your restaurants, there are always lots of people around me doing business. Lots of them. Briefcases, business attire, note scribbling and the awkward laugh of someone trying to make a sale are just some of the telltale signs that give them away.

Are more people doing business in restaurants than ever before? I don't know. Maybe. But there's no doubt people have always done business in restaurants. So, it was good to see recently proposed legislation that would restore the tax deduction for business meals and entertainment back to 80%.

At one time business meals were fully deductible, but in 1986 Congress reduced deductibility to 80%. Seven years later it reduced it further to 50%. The reductions suggest that business meals are not as legitimate as other business expenses. That's ridiculous, particularly since the workplace has changed so much since the mid 1980s.

According to the U.S. Department of Labor, nearly 20 million people worked at home least part time in 2001. Of those, a quarter of them worked full time. That means these people don't have the benefit of corporate conference rooms. As NRA big wig Steve Anderson recently said, restaurants are the conference rooms of small business operators. And let's not kid ourselves: big business is probably using your restaurants to court clients more than the small guys. The pharmaceutical industry, for example, is legendary for dropping coin in restaurants.

The NRA estimates that business-meal sales would increase by almost $6 billion and boost the U.S. economy by $19 billion if the deduction was raised to 80%. Unfortunately, the proposed legislation to raise the deduction would not take effect until 2008 if passed. I just wish it was sooner. Then I could tell the effervescent Mrs. Sanson that it's good for the restaurants of this country, even the country itself, if she doesn't cook. Call me a patriot.

MICHAEL SANSON
EDITOR-IN-CHIEF