Will a proposed meals tax hurt?

(WWLP) - The current Massachusetts budget calls for tax increases to make up for revenues lost due to the stumbling economy.  If the proposal is approved, the state meals tax goes from 5 to 6.25 percent.

Most customers 22News spoke with at Shermerhorns in Holyoke say they don't like the idea, but that they'd still eat out if the state meals tax went up from 5 percent to 6.25 percent.

Bill Brough says, "I don't think it will have a major effect because it's a luxury and it's something we look forward to and we're willing to absorb a little bit extra if we have to."

Tom Florence of West Springfield says, "I think overall,it's not a bad move, the state does need to generate additional income and revenue for overages and if it's gonna help, keep other programs funded.."

But, Shermerhorns owner Michael Fitzgerald says the restaurant is already struggling, and he worries the effects of a meals tax hike could be devastating. Fitgerald says as it is, Shermerhorns has its days where it's extrememly slow, and where it's extremely busy. That's why he'd like to see the meals tax stay where it is at 5 percent, especially since he's not even sure the state will make that much money off of it to begin with.

Furthermore, while the meals tax may go up, the proposal will also allow cities and towns to tack on their own increases, raising it up to an additional .75% to a maximum of 7%.