New Jersey doesn’t just “have” diners; diners are part of the Garden State’s identity. And though lawmakers announced a plan to “save” them amid declining numbers, heightened scrutiny should be on the menu.
Under the proposal, only “historic” diners and restaurants would qualify—those with at least 25 years of continuous operation that qualify as small businesses under federal law. For restaurants to qualify, they also must be family owned. So a 24-year-old-diner or a historic restaurant owned by a group of friends won’t qualify, despite facing the same market pressures the bill is intended to offset.
Those eateries that make the cut would be exempt from the “diner capital of the world’s” sales tax on meals eaten on site and could claim tax credits worth up to 10% of their ingredient costs, with an overall cap of $25,000 per year.
It sounds straightforward, but it may end up an administrative quagmire: a narrow registry of establishments, annual application requirements, certificates, documentation, and nonrefundable credits that only matter if a business owes enough tax to use them. There is no fiscal estimate for how much sales tax revenue the state would forego or how many businesses could fully use the credits.
That matters because the credits are still spending—it just doesn’t show up as a neat line item or need to face annual review. They bypass the budget process and aren’t debated point by point the way schools and pensions may be. Once enacted, they can run on autopilot.
Transparency must be part of the bargain if lawmakers really want to spur preservation.
—Andrew Leahey
Welcome to the Week in Insights for Bloomberg Tax’s latest analysis and news commentary. This week, experts analyzed an OECD update related to remote work, tax snarls for Canadian businesses operating in the US, and more.
The Exchange —It’s where great ideas on tax and accounting intersect.
Insights
US Tax Patchwork Creates Confusing Snarl for Canadian Businesses
Tax nexus is an economic trap lying in wait for Canadians doing business in the US, but there are ways to avoid the pitfalls and ensure compliance.
OECD’s Tax Dispute Resolution Programs Are a Welcome First Step
Competent authorities should work to reduce resolution times for mutual agreement procedure cases and advance pricing arrangements, because these programs likely will remain attractive to taxpayers.
UK Adopts US-Inspired Approach to Tax Whistleblower Rewards
The UK is introducing enhanced rewards for tax whistleblowers, but some features of the program—including the limited guidance and support available and the discretionary nature of rewards—may hinder its success unless remedied.
These Conservation Easement Tax Bill Remedies Need Skepticism
Interest abatement and offers in compromise based on effective tax administration are dubious approaches for investors facing tax liabilities related to syndicated conservation easements.
Estate Planning Goals Hinge on Scrutinizing Fund Retitling Rules
Investors seeking to retitle interests must follow a fund’s requirements to maintain regulatory compliance and protect the fund’s status.
OECD Tackles Tax Complexities of International Remote Work
The new OECD guidance is a step forward in updating the international tax rules to catch up with modern work practices, but companies operating internationally should remain alert to the risks and monitor developments from tax authorities and international bodies.
Trump Tax Policy Shift Toward Stability Must Stay the Course
This year’s tax-and-spending package made our tax code at home more stable, and the Treasury Department’s forthcoming regulations must reinforce—rather than undermine—this stability as tax uncertainty abroad remains.
New York Divorce Case Offers Lesson in Tax, Trusts, and Fairness
A New York court made clear in a divorce ruling that, when assets are held in tax-efficient trusts, equitable tax treatment is inseparable from equitable distribution.
UK’s Clean-Tech Ambition Must Align Energy, Industry, Tax Policy
If the UK wants to lead in the clean-tech race, it will need to treat both fiscal policy and energy security as the twin foundations of industrial change.
Columnist Corner
The Trump administration’s overtime tax break, ostensibly a big win for workers, is less generous and more confusing than advertised, Andrew Leahey writes in his latest Technically Speaking column.
Instead of an overtime deduction, the government should create a flat-rate deduction election that workers could claim “without having to perform forensic accounting on their pay stubs,” Andrew says, noting that the IRS should also do a better job at incentivizing employers to be more transparent. Read More
Tax Management International Journal
US Must Lead Global AI-Driven Tax Transparency Standards Now
The US faces a critical choice between leading or following global digital tax transparency standards.
Why Company Readiness Beats Reaction When Navigating Tax Policy
The key areas of focus for tax departments in 2026 are discussed.
When Courts Say No: 3M and the Future of Treasury Regulations
The Eighth Circuit’s decision in 3M demonstrates a shift towards textual statutory interpretation, restricting IRS authority to reallocate income across international boundaries.
News Roundup
Snoop Dogg Leads Latest Round of California Film Tax Credits
The California Film Commission announced new tax credits for 28 upcoming films, with the largest credit awarded to a biopic produced by and about the rapper Snoop Dogg.
Estonia, Czechia Drop Opposition to Revised Minimum Tax Deal
Estonia and Czechia will accept a renegotiated global minimum tax deal that would carve out US companies from key provisions of the agreement.
Criminal Tax Scheme Probes Plummet as Trump IRS Priorities Shift
New criminal investigations into abusive tax schemes have dropped to a 10-year low as the IRS grapples with the Trump administration’s workforce cuts and shifting priorities.
Republican Health Bill Passes House as Defectors Join Democrats
House Republicans eked out passage of a health-care bill meant to paper over expiring Obamacare subsidies that sparked intra-caucus turmoil.
Career Moves
Jeremy Abrams Departs Foley to Launch Tax Boutique in New Jersey
Former Foley & Lardner attorney Jeremy Abrams has launched his own tax-focused law firm in Jersey City, N.J., Abrams announced Wednesday.
Sullivan & Cromwell Nabs Kirkland Private Equity, Tax Partners
Aprajita Dhundia and Ian Ferreira joined Sullivan & Cromwell as partners in its London office, the firm announced Tuesday. Dhundia joined the private equity and M&A practices, while Ferreira joined the tax group.
Taft Adds 10-Member Tax Team Led by Partner Gina Staudacher
Gina Staudacher will lead a new 10-member specialty tax team at Taft’s tax practice, the firm announced Tuesday.
BHP Appoints New Partner to Lead Global Corporate Tax Services
Callum Doherty joined BHP as a partner heading up the firm’s international and large corporate tax services, the firm announced Wednesday.
Gibson Dunn Names London Tax Attorney to New Partnership Class
James Chandler was elevated to partner in Gibson Dunn’s tax practice in London, the firm announced Wednesday.
Willkie Adds Strelka as Partner, Chair of Tax Resolution Practice
Andrew Strelka joined Willkie Farr & Gallagher as a partner and chair of the tax resolution practice group in Washington, DC, the firm announcedWednesday.
To contact the editors responsible for this story:
Learn more about Bloomberg Tax or Log In to keep reading:
See Breaking News in Context
From research to software to news, find what you need to stay ahead.
Already a subscriber?
Log in to keep reading or access research tools and resources.