Restaurant industry estimates $225B in losses from coronavirus

Restaurant industry estimates $225B in losses from coronavirus
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The National Restaurant Association on Wednesday wrote to President TrumpDonald John TrumpUSPS warns Pennsylvania mail-in ballots may not be delivered in time to be counted Michael Cohen book accuses Trump of corruption, fraud Trump requests mail-in ballot for Florida congressional primary MORE and congressional leaders estimating that the industry’s sales will decline by $225 billion during the next three months, which will prompt the loss of between five and seven million jobs.

At least 28 states have closed dine-in options for restaurants so far, with more expected as the coronavirus spreads. The loss in sales equates to 25 percent of the previously estimated $899 billion the industry expected in 2020 annual sales, according to the association. 

The full economic impact, according to the association, will be $675 billion because every dollar spent in restaurants generates an additional $2 elsewhere in the economy. 

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“We are revising our business model to provide meals in different ways (takeout, delivery, safety-enhanced dine-in), but we are facing economic headwinds that will lead many restaurants to shut down operations, lay off workers, and end our service in our communities,” Sean Kennedy, executive vice president of public affairs, wrote in the letter.

The National Restaurant Association called for financial relief, loans and tax measures to help it combat the crisis.

They requested the authorization of the Treasury Department to create a $145 billion Restaurant and Foodservice Industry Recovery Fund “within 15 days of enactment and provide grants with minimal procedural delay.”

They also called for $35 billion for Community Development Block Grants for Disaster Relief assistance to allow some restaurants to prepare for a return to normal operations, noting that after 9/11 this grant program provided grants to businesses with less than 500 employees.

Additionally, the letter called for assistance in allowing businesses to defer mortgage, lease and loan obligations.

It requested $100 billion in federally backed Business Interruption Insurance that allows for businesses to receive their insured benefit quickly, a federal loan program equal to lost revenue, $45 billion in expanded access to federal loans and $130 million in disaster unemployment assistance

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In terms of tax measures, the association asked for businesses to delay, defer or forgo tax obligations, receive tax credits if they are retaining employees, reduce credit card fees, and temporarily cut the payroll tax.

Restaurant reservations and walk-ins were down 48 percent on Sunday from the same time last year and were down more than 20 percent since March 10, according to data from OpenTable. 

The airline industry this week, through Airlines for America, requested $50 billion in the form of grants, loans and tax relief to weather the coronavirus downturn. And the tourism industry, through the U.S. Travel Association and the American Hotel and Lodging Association, called for $150 billion in overall relief.

Democrats, including Senate Minority Leader Charles Schumer (N.Y.), are pushing back on bailout requests, saying the priority should be helping ordinary Americans.

The White House is seeking a roughly $850 billion economic stimulus package from Congress to address the coronavirus's economic impact.