From the ABL Office
ABL Update by John Bodnovich, Executive Director
GOP Tax Bill Plans on Hold Until Budget Resolution is Agreed Upon
The next step for Congress on the path to a tax reform debate is passing a budget resolution, which could happen sometime this fall. As of now, Congressional Republican leaders don’t yet have the votes to bring the fiscal 2018 budget resolution to the floor. It has been their plan to use a reconciliation bill framed by that budget to move tax legislation and, thanks to Senate rules, allow for passage in the upper chamber by a simple majority. House conservative hard-liners want more details on the tax plan – including whether it will be revenue-neutral – before agreeing to a budget resolution.
For beverage licensees, a major tax reform bill could have an impact in a handful of different ways:
“Craft Beverage Modernization” Update
“Death Tax Repeal Act” Update
End Drunk Driving Act Introduced by Rep. Kathleen Rice (D-NY)
Rep. Rice initially announced that she would introduce the bill in December 2016. It:
Overtime Rule Dead Following Judge’s Ruling
Judge Mazzant found that the Obama Administration’s proposed overtime rule went beyond Congress’ intent in determining who should be exempt from overtime pay. “If Congress was ambiguous about what specifically constituted an employee subject to the [executive, administrative and professional] exemption, Congress was clear that the determination should involve at least a consideration of an employee’s duties,” Mazzant concluded.
Judge Mazzant initially froze the rule on November 22, 2016 from taking effect on December 1, 2016. Numerous business groups and 21 states had legally weighed-in in opposition to the rule at that time. Since taking office, the Trump Administration has asked for public comment on changing the overtime threshold instead of mounting a vigorous appeal to the judge’s ruling.
Department of Labor May Rescind Tip Pooling Regulations
Current regulations state:
“Tips are the property of the employee whether or not the employer has taken a tip credit under section 3(m) of the FLSA. The employer is prohibited from using an employee’s tips, whether or not it has taken a tip credit, for any reason other than that which is statutorily permitted in section 3(m): As a credit against its minimum wage obligations to the employee, or in the furtherance of a valid tip pool.”
From the Department of Labor announcement:
“Section 3[m] of the FLSA, 29 U.S.C. 203[m], provides in part that an employer may take a partial credit [tip credit] against its minimum wage payment obligation to a tipped employee based on tips received and retained by the employee. The Department’s regulations limit an employer’s ability to use an employee’s tips regardless of whether the employer takes a tip credit under Section 3[m] or instead pays the full FLSA minimum wage directly to the employee. In this Notice of Proposed Rulemaking, the Department will propose to rescind the current restrictions on tip pooling by employers that pay tipped employees the full minimum wage directly.”
As of early September, a Notice of Proposed Rulemaking – the next step in the process to rescind the regulations – has not been issued.
South Dakota Licensed Beverage
Dealers and Gaming Association