WASHINGTON D.C. – U.S. Senators Ben Cardin (D-Md.), Chair of the U.S. Senate Committee on Small Business and a senior member of the Senate Finance Committee, and Senators Sherrod Brown (D-Ohio) and Patty Murray (D-Wash.), today introduced The Restaurant Revitalization Tax Credit Act. This legislation creates a special tax credit available to businesses that applied for the Small Business Administration (SBA) Restaurant Revitalization Fund (RRF) program but were unable to receive a grant because the program ran out of funding. Nearly 2 of every 3 eligible RRF applicants, or approximately 175,000 businesses, were left unassisted. The Restaurant Revitalization Tax Credit (RRTC) will help restaurants still struggling to recover after two of the most challenging years in the history of the food and beverage industry meet increased labor costs and other rising operational expenses.
“The Restaurant Revitalization Fund was an essential part of the federal government’s COVID-19 response, but unfortunately, those restaurants that did not get help from SBA are still hurting," said Senator Cardin. “I’ve heard from many owners who, having missed out on RRF, have had to draw down on their personal retirement savings or put their homes up as collateral to keep their businesses afloat. While the pandemic has receded for many Americans, and we have made great strides to regain a sense of normalcy, this is not the case for small restaurant and bar owners still struggling to repay debt accrued during the last two years while facing increasing labor and supply costs. This tax credit will help ease their burden.”
“Restaurants clearly are anchors in so many communities – more than just a place to eat they are destinations, engines for local economies and small businesses that employee our neighbors,” said Senator Brown. “I’m proud to introduce the Restaurant Revitalization Fund Tax Credit for the thousands of qualified restaurants that did not get the help they needed and are still working hard to stay afloat.”
"Restaurants are the heart and soul of communities throughout Washington state. As our country continues to recover from the pandemic, restaurants need our help to keep their doors open and employees on payroll,” said Senator Murray. “While the American Rescue Plan saved thousands of restaurants, its Restaurant Revitalization Fund left too many behind. I believe we need to replenish the Fund and will keep pressing to do so. Until that happens, bills like the Restaurant Revitalization Tax Credit Act will help keep restaurants afloat. This tax credit would benefit every eligible restaurant that applied to the Fund, but never received a grant through no fault of their own. Washington state’s restaurants and small businesses deserve our ongoing support and I will continue fighting for them in the Senate. I strongly urge my colleagues to help us get this legislation signed into law before the end of the year.”
The Restaurant Revitalization Tax Credit Act establishes the RRTC, which is available to eligible employers to offset payroll taxes of up to $25,000 per quarter in calendar year 2023. For businesses with 10 or fewer employees, the credit is refundable up to a total of $25,000 over the course of the year, with the cap on refundability gradually phased out for businesses with fewer than 20 employees. The credit is open only to those businesses that applied for and were eligible to receive RRF grants. They also must have experienced average operating losses of at least 30 percent in 2020 and 2021 as compared to 2019 or losses of at least 50 percent in either calendar years 2020 or 2021 as compared to 2019. In addition, a business must have been in operation prior to March 14, 2020, and have paid payroll tax in at least two quarters in 2021.
Click here to view a PDF of the bill text, and here to view a bill summary.