June 10, 2009

Dear Editor:

The New Jersey Restaurant Association is extremely dissatisfied that Governor Corzine has proposed a 25-percent tax increase on wine and spirits. The eating and drinking industry employs more than 300,000 people in 23,000 establishments across the state. While this increase is budgeted to garner $22 million in state revenue, the effect that it will have on restaurants will render this additional revenue stream arbitrary.

Currently, the retail price of the average bottle of wine and spirits includes almost 50-percent in taxes. With an additional 25-percent tax added, restaurants, bars, catering facilities and liquor stores will have no choice but to increase their prices. The lagging economy has already hit the restaurant community particularly hard and this increase will hurt patrons and businesses alike. While patrons cut back due to the higher price, waiters and bartenders will see reduced tips.

What many people may not know is that the hospitality industry’s average net profit is three percent. That means that for every dollar collected, we only see three cents of profit. So a tax increase here and a fee increase there is death by a thousand little cuts. These little cuts add up to a lot of dollars that, in this economy, many of us just don’t have.

The New Jersey Restaurant Association, together with the New Jersey Wine & Spirits Wholesales Association and the New Jersey Liquor Stores Alliance has launched a petition to raise awareness of the proposed tax. On June 9th, a petition containing almost 6,000 signatures was submitted to the Governor’s office and legislative leadership in opposition. A website has also been set up where people can send e-mails to legislators. To send an e-mail to legislators opposing the 25-percent tax increase on wine and spirits, please visit www.axetaxesnotjobs.com.

Thank you,

Jimmy Thornton
The Grand Summit Hotel/The Hunt Club Grill
Chairman, New Jersey Restaurant Association

(For any confirmation on the content of this letter, please call Andrea Pass or Steven Emery at 201-498-1600.)