The IRS targets free meals.
As if its appetite were not insatiable enough already, Obama’s Internal Revenue Service is considering taxing the free lunch.
Some companies offer workers mid-day meals on the house. This encourages their employees to stay near work, dine with colleagues, exchange ideas, avoid nosy competitors, and then return to their duties. These voluntary arrangements are among the things that attract people to high-tech companies like Apple, Google, and PayPal.
According to the Wall Street Journal, “IRS auditors are now flagging the issue and demanding back taxes from companies amounting to 30 percent of the meals’ fair-market value.” So if an employee eats three $25 lunches per week at work, then after 50 weeks, the 30 percent Obama Lunch Tax would cost that worker or his company $1,125 in new taxes.
It would be bad enough to inflict the Obama Lunch Tax prospectively. But applying this as a back tax — likely with penalties and interest — is tyrannical and unconstitutional. America’s founding document forbids ex post facto laws. How can businesses operate in fear of new taxes that may erupt, and then be applied retroactively? What’s to stop the IRS in 2017 from declaring a photocopying tax and docking companies for employees’ personal use of Xerox machines . . . from 2009 through 2016?
Compliance costs would be another headache. What if an employee eats at the freebie cafeteria on Monday, Wednesday, and Friday, but visits the local Denny’s on Tuesday and brings in a sandwich on Thursday? And what if she grabs a bag of potato chips from the cafeteria that afternoon? Does the Obama Lunch Tax apply just to the chips, or does touching any part of the buffet trigger the same levy as if she devoured the entire smorgasbord? (Call it the One Chip Rule.) How many new accountants must eBay hire to document who ate what, and how much of it, and then tax employees accordingly? How long before these and other niggling irritations drive aggravated companies from America altogether?
Treasury Department spokeswoman Erin Donar told the Washington Post’s Richard Rubin, “The application of tax rules to employer-provided meals in various contexts is an area in which additional guidance may provide useful clarity for employers.”
“‘Guidance,’ is often Fed-speak for ‘Take out your checkbook,’” Pete Sepp of the National Taxpayers Union tells me. He expects that “some companies may be forced to hash out with the IRS whether a corporate campus is ‘remote’ enough to hinder employees from leaving during the day. What a wonderfully productive use of innovators’ time.”
Sepp also sees the Obama Lunch Tax as potentially Earth-unfriendly. What if a company simply gives up and stops providing free lunches?
“Suddenly, instead of taking a healthy walk across campus to the cafeteria, people will jump into those big, bad cars to go grab lunch,” Sepp predicts. “Shouldn’t the Left be up in arms over a punitive tax that encourages people to leave bigger environmental footprints?”
So what? Silicon Valley’s web designers can afford the Obama Lunch Tax.
Who cares? Neither Obama nor the IRS should fleece overtaxed Americans just because they can. Besides, lower-paid secretaries, janitors, and interns would pay this tax, too.
And what’s to keep Washington from going beyond lunch? To keep their employees happy, healthy, and sane, many companies provide complimentary gyms and free parking. How dare they? Why not also tax these as fringe benefits?
And why not a heating-and-cooling tax? Why should workers enjoy 72-degree indoor temperatures throughout the year without Washington getting paid in the process?
For these reasons and more, the Republican House immediately should strangle the Obama Lunch Tax in its crib. GOP leaders should force Democrats to choose either their tax-hungry Dear Leader — and his unquenchable thirst for taxpayer dollars — or the American workers who simply want to enjoy lunch without Obama and the IRS prying it from their mouths.
Obama — who boasts a tax-free personal chef — often whines about corporate greed. But when it comes to avarice, he and his tax collectors take the cake.
— Deroy Murdock is a Manhattan-based Fox News contributor and a media fellow with the Hoover Institution on War, Revolution, and Peace at Stanford University.