May 7, 2020
To: Members of the New Jersey Senate
From: Americans for Tax Reform (ATR)
Re: ATR Opposes S2437
On behalf of Americans for Tax Reform and our supporters across the state of New Jersey, I urge you to oppose S2437, (A3978). This misguided legislation would cap fees for food delivery service apps at 15% during a state of emergency.
This policy is effectively a price control that would hurt New Jerseyans at the worst possible time, harming food delivery providers, restaurants, and consumers.
The bill’s premise is that food delivery apps hurt restaurants struggling during the current pandemic, when, in the majority of cases they are helping to facilitate more business than a restaurant would otherwise get.
Capping fees does not eliminate the costs these fees currently cover, it just shifts who pays those costs, burdening consumers instead, and rapidly forcing delivery app companies to change their business models.
A wide range of companies have created a competitive market that is answering to the challenge of coronavirus with strict hygiene standards, and providing New Jerseyans with avenues to get meals while food supplies are strained. Further, restaurants retain the option to sell delivery and take-out orders directly to consumers.
As people are directed to stay at home, food service apps are a lifeline keeping drivers working and orders coming in to restaurants. Imposing sudden new costs risks reducing those orders and hurting consumers, drivers, companies, and restaurants all at once. For these reasons we urge you to reject S2437.
Grover G. Norquist
Americans for Tax Reform