Updated: Amidst opposition, council approves meals tax increase

Updated: Amidst opposition, council approves meals tax increase
(File photo)

City council increased the restaurant meals tax from four to five percent at its public hearing Saturday.

Council approved the increase, which will go toward the city’s dedicated affordable housing fund, by a 4-3 vote, with Vice Mayor Justin Wilson, Councilor Paul Smedberg and Councilor Tim Lovain dissenting. The meals tax increase, proposed by Councilor Willie Bailey, was tentatively approved by council by a 4-3 vote at the budget adoption May 3.

Ahead of the final vote, restaurateurs took action against the tax increase, including launching a petition on Thursday.

Cheestique owner Jill Erber, HomeGrown Restaurant Group’s Bill Blackburn, Stomping Ground’s Nicole Jones, the Jen Walker Team’s Jen Walker, Fibre Space’s Danielle Romanetti and Elizabeth Todd, owner of The Shoe Hive and The Hive, asked residents to take steps to prevent the tax, which would bring the meals tax for Alexandria restaurants to 11 percent. 

The group asked individuals to sign a petition urging city council to do the following: repeal the tax increase, provide a three percent rebate on meals tax revenue collected by restaurants for the city and hold a public hearing before any tax increase is considered and again following the add/delete process prior to adopting the budget or any ordinance.

The petition stated that, while funding for affordable housing is important, taxes weren’t the only way to address the need.

“Expanding affordable housing is a worthy goal, but there are ways to do so without new taxes – and there are ways to raise tax revenue that do not unduly burden a single industry,” the petition read. “Further, the meals tax disproportionately hits low income families who spend a larger percentage of their budget on meals. It also leaves restaurateurs with less money to hire employees and grow their businesses.” 

The Alexandria Chamber of Commerce and the Del Ray Business Association reiterated their stance against the meals tax increase ahead of the vote.