Obamacare Restaurant Surcharges

Health Care Compact

Obamacare Restaurant Surcharges

February 28, 2014

There is one thing the public may find hard to swallow about Obamacare: restaurant surchares. CNN Money reports: “diners at eight Gator's Dockside casual eateries are finding a 1% Affordable Care Act surcharge on their tabs, which comes to 15 cents on a typical $15 lunch tab. Signs on the door and at tables alert diners to the fee, which is also listed separately on the bill.”

"The costs associated with ACA compliance could ultimately close our doors," the sign reads. "Instead of raising prices on our products to generate the additional revenue needed to cover the costs of ACA compliance, certain Gator's Dockside locations have implemented a 1% surcharge on all food and beverage purchases only."


Meanwhile, in Los Angeles, an upscale restaurant is also asking guests to pony up for its employee health care costs.


Since it opened in November, Republique's tab comes with an optional 3% surcharge that allows it to employ all of its 80 workers full-time and provide them with health insurance. The fee is explained in a sign and on the menu, and servers explain it to diners without prompting.


The surcharge is not related to Obamacare, a restaurant spokeswoman said. The eatery is not subject to the employer mandate until 2016 because it has fewer than 100 workers, but it already offers coverage to its staff.


As Arthur Brooks of the New York Times pointed out, Obamacare acts like a tax. Two taxes in fact, an income tax and employment tax. To the diner however, it appears as a sales tax, something that NY Magazine has already noticed. Some commenters have claimed that conservatives will be “delighted” at the develoment, saying it proves them right all along. But liberals will have to pay the tax too.