The Tax Bite
on Everyday Products….MEALS

Eating out is not cheap, but the government doesn’t make it any easier to enjoy a meal at your favorite restaurant by taxing it.

In most places, you of course must pay sales tax on your bill. Many jurisdictions impose special, higher sales taxes on drinks or food sold at restaurants. So the sales tax can be as high as 10 percent of your bill.

But that is just the beginning. Out of what the consumer pays for the meal, the restaurant must pay federal income taxes, state income taxes, federal payroll taxes, unemployment insurance taxes, workmen’s compensation taxes, state franchise taxes, local property taxes and any local income taxes.

Altogether, these taxes average 17.6 percent of a typical restaurant bill. Counting the sales tax paid by the consumer, this means that about 27.6 percent of your bill ends up going to the government in taxes.

Click here for other Tax Bites