Proposed Roanoke meals tax increase criticized by restaurants

Proposed Roanoke meals tax increase criticized by restaurants (Image 1) (Copyright by WSLS - All rights reserved)

ROANOKE (WSLS 10) - Roanoke City Council is considering raising the meals tax to help make up for a $3.4 million budget gap.

The tax would increase from 5 percent to 5.75 percent.

During a public hearing on the city budget Thursday, several restaurant owners came together to criticize the proposed move.

That includes Sweet Donkey Coffee owner Dustin Eschelman. She said it's difficult for restaurants to accept a meals tax increase when the price of food and rent are also on the rise.

"What we do as business owners is we raise our prices every year a little bit to accommodate that," Eschelman said. "If you also have a rising meals tax, it just makes our margins even thinner, so we can't, as business owners, earn very much."

Even if Roanoke's meals tax is raised to 5.75 percent, it would still be lower than several nearby localities.

The meals tax in Salem, Blacksburg and Danville is 6 percent. It's 6.5 percent Lynchburg and Martinsville.

Roanoke County's meals tax is lower at 4 percent.

Roanoke City Council is also looking at other options to reduce the gap, including increasing the motor vehicle license tax from $20 to $25 and implementing a $7 per month fee for garbage collection.

Council is expected to vote on the proposed increases by the end of June.