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NBC Washington

By Julie Carey

Restaurant workers demonstrated outside the Fairfax County, Virginia, government center Tuesday in opposition to a meals tax being considered by the Board of Supervisors to increase county revenue.

A meals tax would be assessed on all prepared foods – including drinks sold along with them – from restaurants, cafeterias, coffee shops, food carts and ready-to-eat grocery items.

At 1%, a meals tax would generate $33 million. The top rate allowed – 6% – would mean $198 million.

Kyle Schoenberger said he opposes any sort of meals tax because he believes it could hurt the restaurant he works for and, in turn, his livelihood.

“We’ve also heard feedback from people in terms of how much they’d still go out if the tax is raised, and that would affect our income as well,” he said.

Timmy Norton of the restaurant group Great American Restaurants said he’s concerned about the impact on lower income residents who spend a bigger percentage of their budget on prepared foods.

“I don’t think this is a necessary tax, because, again, it’s a single-industry tax that is solely going to impact lower-middle class folks and working class folks the most,” he said.

In a budget committee session Tuesday, the Fairfax County Board of Supervisors wanted to get a fuller picture of how adding several other types of taxes might work to slightly shift the heavy reliance on property taxes.

“All we signaled was to get the information today,” Chairman Jeff McKay said.

Supervisors say a meals tax could ease the burden on property owners.

“The opportunity here is to identify what options we might have other than the residential tax rate as a way to provide for some of the critical services,” Franconia District Supervisor Rodney Lusk said.

Many Northern Virginia jurisdictions – including Arlington, Alexandria and Prince William County – already have food taxes, ranging from 3% to 5%.

If the Board does decide to move ahead with the tax, the staff recommends doing it as part of next year’s budget process, meaning a possible vote in spring 2025. If it wins approval, the earliest it could be collected would be January 2026.

Washington Examiner

By Stephanie Lundquist-Arora

Fairfax County, Virginia’s Democrats and Republicans do not agree on much, but they are joining hands across the political chasm to oppose the meals tax.

Fairfax County’s referenda to implement a meals tax, a fee imposed on the purchase of all prepared, ready-to-eat food and beverages, have failed on the ballots in 1992 (58% opposing) and 2016 (56% opposing). Beginning in 2020, the Virginia General Assembly, in all of its wisdom, allowed localities to pass such a tax without putting a referendum on the ballot directly to the voters.

So, in May 2024, the Fairfax Board of Supervisors voted 9-1 to circumvent the public and vote on a meals tax between 1% and 6%. Residents expect the plan to be presented at the Budget Committee meeting on Sept. 17 and voted on at a subsequent board meeting this year.

Not only is this initiative anti-democratic, given voters’ previous rejection of it, but the meals tax is also regressive. For a group of politicians that speak incessantly about equity, they do not seem to care that this would create a substantial burden for all residents and particularly for lower-income households.

Additionally, the meals tax will likely put many restaurants out of business. In case the draconian pandemic policies were not enough to end Fairfax families’ dreams of running their own businesses, the local government will continue the mission of forcing permanent closures with the burden of the meals tax.

Waria Salhi, a partner with Mezeh Mediterranean Grill, said, “I think it’s crazy at this time when inflation is already high, and people are barely making ends meet, and now you hit them with this tax?”

About 100 local restaurant owners join Salhi in his view and have created a group called Stop the Food Tax. 

This burdensome tax is in addition to the Board of Supervisors’s decision to increase the average homeowner’s taxes this year by 6%. According to a press release from Supervisor Pat Herrity, who is the only board member to vote against considering the meals tax, these recent burdens fall on top of a 56% homeowner’s tax increase over the last 10 years.

And can we honestly say that our local government services have improved with the skyrocketing tax burden? Absolutely not.

Fairfax County’s public schools, which account for more than half of the tax burden, have declined significantly. Test scores have plummeted, chronic absenteeism and dropout rates are astronomically high, and six high schools are on the verge of losing accreditation.

Meanwhile, violent crime in Fairfax County increased 8.7% in 2023, the seventh most significant increase in the country.

Both the decline in school performance and the increase in violent crime coincide with the Fairfax County Board of Supervisors’s “Trust Policy,” passed in January 2021, to make Fairfax County a sanctuary for illegal immigrants.

While our property taxes are covering the costs of the county’s sanctuary policy and Fairfax families are struggling with inflation, Jeff McKay, chairman of the Board of Supervisors, has voted to increase the salaries for himself and his other part-time elected colleagues substantially. In 2024, McKay’s salary increased by 45%, to $145,000. At the same time, the other members of the board voted to increase their part-time annual salaries from $95,000 to $130,000. Fairfax County’s taxpayers are also paying for McKay’s car, gas, tolls, and oil changes.

If it seems like children have taken over the local budget, that’s because they have. Who else but a child would think it’s OK to drown residents in tax burdens and give yourself a 45% raise and a free car? 

Many Fairfax voters are rightfully shocked about the county’s proposed meals tax, but we should have been appalled a long time ago.

Stephanie Lundquist-Arora is a contributor for the Washington Examiner, a mother in Fairfax County, Virginia, an author, and the Fairfax chapter leader of the Independent Women’s Network.

WJLA

By Nick Minock

Fairfax County Board Chair Jeff McKay and the Fairfax County Board of Supervisors are considering implementing a food tax. The board of supervisors is expected to discuss the food tax at their next meetings in September.

Several restaurant owners tell 7News that a food tax would hit their businesses hard. Many restaurants still haven’t fully recovered from COVID-19 shutdowns, and they are facing the impacts of rising costs and inflation.

“I think it’s crazy,” Waria Salhi, Co-Owner of Mezeh Mediterranean Grill said about the food tax proposal. “I was just looking at the news report today, restaurant chain after another are going out of business. We want to make Fairfax more affordable for businesses to come in so we could have more jobs. I think it’s just crazy. It’s not a very reasonable idea at this time, especially when everything, every cost went up, and we’re paying high rent, utilities up, food costs up, labor is up, credit card processing are up.”

Gary Cohen, the Executive Vice President of Government Affairs and Franchising for Glory Days, said many restaurants in Fairfax County have already had to increase prices due to inflation in recent years.

“I think most of my restaurant friends are telling me somewhere around 20% price increases just since 2020 and that kind of matches what the grocery stores did,” said Cohen. “We’ve already lost customers because of it.”

And he fears he would lose more customers if the Fairfax County Board of Supervisors approves a food tax.

“We don’t want any meals tax,” said Cohen. “We don’t want any [food tax]. The restaurant industry is still reeling from COVID. We’re raising prices just to stay business. Restaurants, notoriously, are a low-profit industry. We make maybe 5% profit national standards. And every time you raise prices, or you have an increase in the economy, we see decreases in customer counts.”

Mezeh Mediterranean Grill in Fair Oaks and Glory Days Grill are preparing a campaign with other Fairfax County restaurants to ask residents to tell their Fairfax County Board of Supervisors to vote no on a food tax.

“One, it is going to hurt the businesses like us, and second it’s going to hurt the people with a low income,” said Salhi. “Not many people know that when customers walk into the store, they’re paying 6% tax to the state. Now, if Fairfax adds an additional up to 6% that will make it 12%, and that will make it very unaffordable for our residents and our customers.”

He adds taxes are already going up in Fairfax County.

“Taxes keep going up,” said Salhi.

This year, the Fairfax County Board of Supervisors voted to raise property taxes again.

“I just think that restaurants are struggling across the country, and that includes right here in Fairfax County,” said Cohen.

Fairfax County also has a $240 million surplus this year.

“We just think this is just unnecessary,” said Cohen. “A lot of the folks that we already have talked to on the board of supervisors, they’re somewhat dismissive in saying, ‘You know, Arlington has a meals tax, and Prince William has a meals tax, and they’re still in business’. Well, I think that’s short-sighted. They may still be in business a little bit longer, but they may be on their way out of business. I have restaurants in Prince William County, and I can document that the customer counts there have decreased more than they have in Fairfax County, where we have no meal tax.”

In 2016, 56% of Fairfax County residents voted against a food tax, according to election results. That was the second time residents rejected a food tax. But now the board can enact a food tax with a simple board vote because the Fairfax County Board of Supervisors went to the Virginia General Assembly to change the law.

“Where’s the democracy in this process?” asked Salhi.

Some restaurants are handing out fliers telling customers they can help defeat the food tax by emailing their supervisor to vote no on the food tax.

7News asked all of the supervisors how they would vote on a food tax proposal.

Only Supervisor Pat Herrity responded.

“I am adamantly opposed to the meals tax recently brought forward by Chairman McKay and Board members Dalia Palchik and Kathy Smith,” Herrity told 7News. “This proposal came after only two weeks after the Board approved an increase on the average homeowner’s taxes of 6% on top of a 56 percent increase over the last 10 years. In addition, we now have a surplus of 240m for the fiscal year that ended June 30, 2024. Despite being overwhelmingly rejected by residents twice, most recently in 2016, the County will be considering a meals tax which would increase the tax on prepared meals and beverages to up to 12%. Unlike last time this was considered, there will not be a referendum where residents could once again weigh in. In 2020, the Board went to the General Assembly to change the rules and take the residents out of the equation. This comes at a horrible time as residents struggle with the affordability of prepared meals and food nationwide, it will impact the low-income workers that rely on prepared foods the most and hits an industry that is still struggling to recover from the pandemic and has margins under 6%.”

In May, Chair McKay and Supervisors Kathy Smith and Dalia Palchik wrote in a letter to the board of supervisors, “As we look for additional tools to diversify our tax base, we cannot leave any in the toolbox. We, therefore, as the Chair and Vice Chairs of the Budget Committee, ask the County Executive to come back to the Board at the September 17 Budget Committee meeting with all options for revenue diversification, including the implementation of a meals tax. Options for the meals tax should include: a range of 1-6% and subsequent revenue projections for each; comparisons with local meals taxes implemented in the region; the timeline and cost for implementation, including estimates for industry; and any restrictions on the use of revenue generated by the meals tax. Furthermore, we ask the County Executive to provide a draft community outreach strategy for potentially implementing the meals tax. As part of the timeline for implementation includes work with businesses, we expect restaurants and other businesses to be substantively included in the outreach process.”

Fairfax County Times

By Jimmy Henderson

Small businesses, restaurant industry workers, and restaurant-goers are reeling at the possibility of a meals tax, which will be presented before the Board of Supervisors Budget Committee at its Sept. 17 meeting. Inflation and an increased real estate tax passed earlier this year already have residents feeling the squeeze. This new proposal was a bridge too far for some of its prominent opponents. 

Fairfax residents have roundly rejected referendums for tax on meals and prepared foods in 1992 and 2016, and Fairfax Families Against the Food Tax launched a campaign to remind the Board of just that. Springfield District Supervisor Pat Herrity, the sole dissenting vote in the Board’s decision on this tax, said the community has already spoken when they voted against it, but won’t get the chance this time.

“The worst is the Board went behind the residents’ back and had the General Assembly remove the people from the process,” Herrity said.

Under a 2020 Virginia law passed by the General Assembly, the county could impose a tax on meals between 1% and as much as 6% without appearing on a ballot. According to the group, if the tax is implemented, residents could pay up to 12% more on foods prepared and ready to eat at restaurants and grocery stores, beer and wine served at breweries and wineries, concessions at movies and sports arenas, and more. 

Herrity said restaurant workers are frustrated at the return of this issue.

“They are angry because they’ve fought this battle once before,” Herrity said. “And the people weighed in, and they’re angry because now they have to do it again, and the people have been taken out of the equation. You’ve got to remember, this isn’t just on McDonald’s. It’s on your takeout and grocery stores. It’s on breweries and wineries. I mean, it’s on food and drink. Any prepared food and drink.”

Mezeh Mediterranean Grill owner Waria Salhi said this tax comes at a critical time for diners and industry workers alike.

“Industry studies show that rising prices are driving customers away, forcing them to make tough choices about dining out,” Salhi said. “We’re also struggling with the impact of inflation.”

Salhi said restaurants already operate on slim profit margins between 3% and 5%.

“To stay in business, we must adjust our prices to cover these increases,” Salhi said. “Adding another 2 to 6% in taxes will significantly hurt our business and could impact Fairfax diners even more.”

Chairman Jeff McKay, Sully District Supervisor Kathy Smith, and Providence District Supervisor Dahlia Palchik moved that the Board direct the County Executive to report to the Board, at its Sept. 17, Budget Committee meeting, with all options for revenue diversification, including the implementation of a meals tax. According to a 2014 Fairfax County Meals Tax White Paper, a 4% meals tax would mean a $90 million tax increase, with residents bearing the brunt of it, paying 72%.

The Restaurant Association Metropolitan Washington cited Bureau of Labor Statistics and National Restaurant Association data from 2011, which said lower-income families feel the pain of paying this tax. Census Bureau and AARP data from the paper highlight retirees living on fixed incomes who will pay a larger share of this tax since seniors tend to dine out more than younger residents. Herrity expanded on the fiscal challenge posed to older residents.

“They again become the hardest hit,” Herrity said. “Senior citizens are getting taxed out of the county by the real estate tax, especially them on their own. Now that the real estate tax is to the point now that they’re more than the price that their mortgages used to be.”

RAMW said its members reported a staffing reduction of about 17% at restaurants in jurisdictions where a meal tax is imposed. In a case study, they also noted that tipped employees lose around 20% of their income to meal taxes. 

Annandale restaurant Jang Won owner Duk Man Kim sees great risk for small businesses like his if the meals tax is adopted.

“We do not have the luxury of operating on a large scale, or in multiple jurisdictions,” Kim said. “Making ends meet as a business owner versus having to close often comes down to small variations in customer traffic. Having to raise the price for consumers on their bill due to the county pushing this tax will make [the] task even harder.”

A RAMW case study of a restaurant group with establishments in Fairfax County and Arlington found that in the 20 years since imposing a meals tax, the Arlington location fell behind in sales by $3 million.

In the fiscal year 2023, Fairfax County’s General Revenue fund was expected to increase by 3.24%, but exceeded those expectations at 4.76%. Despite this, Palchik, Smith, and McKay told the Board in a letter that they can’t leave any tools in their revenue diversification toolbox, including a potential meals tax. They asked the county executive to develop a draft community outreach strategy and said they expect restaurants and businesses to be “substantively included in the process.” 

Herrity highlighted the recent bag tax, the increased cost of used cars since the pandemic, and rising personal property and real estate taxes, which increase the financial burden on the people who live, work, and play here.

“It’s made Fairfax County unaffordable for many of our residents,” Herrity said. “And that’s why it’s important to stop here. Not only that. This is a single-industry tax that affects an industry that is struggling.”

Fairfax voters have already rejected a proposed meal tax twice, most recently in 2016. Area restaurants,
their teams, and the community at-large now rallies together again to fight the tax being considered by the Fairfax County Board of Supervisors.

FAIRFAX, VIRGINIA – The organization Fairfax Families and Workers Against the Food Tax is launching a countywide advocacy campaign to remind the Fairfax County Board of Supervisors that the voters of Fairfax do not want a tax on prepared food across the County.

On May 31st, Chairman McKay directed County staff to prepare a presentation on the fiscal impact of a possible tax on prepared foods of up to six percent. That presentation will be made at the September 17th meeting of the Budget Committee with the expectation that the Board will advertise an ordinance that allows a meals tax in Fairfax County at a 2024 Board Meeting.

Fairfax voters decisively rejected the tax at the ballot box twice, most recently in 2016. However, the Virginia General Assembly has since removed the requirement for such tax increases to be approved by voters. Now, only a simple majority vote by the Board stands between Fairfax diners and this unwelcome up to 6% addition to their bills.

“This tax increase comes at a critical time for both Fairfax’s diners and restaurateurs,” said Waria Salhi, owner of Mezeh Mediterranean Grill. “Industry studies show that rising prices are driving customers away, forcing them to make tough choices about dining out. We’re also struggling with the impact of inflation.”

The proposed meals tax comes when the industry is already grappling with higher costs for labor, rent, utilities, food, meat, chicken, and credit card fees. “Restaurants typically operate on a slim three to five percent profit margin,” Salhi added. “To stay in business, we must adjust our prices to cover these increases. Adding another two to six percent in taxes will significantly hurt our business and could impact Fairfax diners even more.”

Duk Man Kim, owner of Jang Won Restaurant in Annandale, agrees with the notion that this tax could be extremely detrimental to small businesses in Fairfax County. “Small restaurants like mine are at great risk from a food tax. We do not have the luxury of operating on a large scale, or in multiple jurisdictions,” said Kim. “Making ends meet as a business owner versus having to close often comes down to small variations in customer traffic. Having to raise the price for consumers on their bill due to the County pushing this tax will make task even harder.”

Fairfax Families and Workers Against the Food Tax has launched a website that allows voters to share their thoughts on the tax proposal. Visit www.stopthefoodtax.com to learn more.

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Fairfax Families and Workers Against the Food Tax is a non-profit organization made up of restaurateurs,
their teams, and the community at-large setup to advocate against the institution of a tax on prepared
foods in Fairfax County

Dear Pat,

On behalf of our member businesses in the Mount Vernon, Franconia and Springfield areas of Fairfax County, we are writing to express our concerns over the May 21st Board of Supervisors’ affirmative vote to consider a meals tax of up to 6 percent on all prepared food and drinks sold in Fairfax County.

It was a disappointment to see this matter come before the Board when the voters in Fairfax County have soundly rejected this proposal twice. Voters who are also business owners have worked diligently to counter inflation, increasing costs for labor, and rising interest rates which are cutting into their profit margins. Rather than increasing new ways of burdening the voters and businesses with additional taxes, we would encourage the Board to identify ways to find efficiencies and financial savings within the County’s operating budget.

In addition to this concern, a meals tax has specific problems which we encourage you and the entire Board to consider:

This is a single industry tax and harmful to an important industry that employs hundreds of Fairfax County residents and pays thousands of dollars in taxes to the county. While total sales numbers have surged on a per-dollar basis due to inflation, restaurateurs tell us that their customer counts are still very much down since the pandemic, while their costs in nearly every single line item have gone up, from labor to food to energy to rent to interchange fees and beyond. Prices are already at a level that is pushing customers to lower-cost restaurants.

There is a myth that the majority of income from a meals tax will be paid by visitors to Fairfax County and not residents. There will be some income from visitors, but the reality is that most prepared food purchased in Fairfax County is purchased by residents. Residents are already paying more in property taxes, more in various fees, a higher sales tax and a bag tax. All these taxes and fees contribute to the greater issue of “affordability” or what it costs to live in Fairfax County.

A meals tax will impact lower-income Fairfax County residents more. The USDA reports that as incomes rise, U.S. households spend more money on food, but it represents a smaller share of their income. In 2002, households in the lowest income quintile spent an average of $5,090 on food (representing 31.2 percent of income), while households in the highest income quintile spent an average of $15,713 on food (representing 8.0 percent of income). This means that the lowest income Fairfax residents are the ones who will feel the most pain from this proposed meals tax.

It will be expensive for small restaurants to implement a meals tax. These small, independently run establishments will have to revamp their entire systems to collect and send a meals tax to the county. They do not have dedicated IT departments like chain restaurants and will have to deal with this on an individual basis, incurring additional costs. Additional operating expense imposed by the county puts small businesses at risk for failure.

In addition, this proposed tax will only serve as a general revenue boost of between $33 and $200 million out of a total budget of $3.5 billion and these funds are not currently dedicated to the promotion of tourism/dining in the county as other jurisdictions with a meals tax have done.

Restaurants are part of the entire business ecosystem in Fairfax County and should not be singled out for a separate tax that will place burdens on owners. Let’s keep the advantage we have in Fairfax County with a meals tax free zone and encourage visitors and residents alike to come and enjoy our restaurants.

Sincerely,

Eric Christensen
Chairman
Mount Vernon Springfield Chamber of Commerce

Click here to download the letter