Bonamici, Meijer Introduce Bipartisan Bill to Repeal Increased “3 Martini Lunch” Deduction; Direct $5 Billion to Child Care

WASHINGTON, DC [5/28/21] – Today Representatives Suzanne Bonamici (D-OR) and Peter Meijer (R-MI) introduced legislation to end a large and unnecessary tax deduction for business meals and redirect the estimated $5 billion in savings to support child care.

The Choosing Healthy Investments and not Lunch Deductions (CHILD) Care Act would repeal a temporary rule that has been dubbed the "three martini lunch deduction," which increased the business meal and entertainment deduction from 50 percent to 100 percent. Doubling the deduction is projected by the Joint Committee on Taxation to cost more than $5 billion over 2022 and 2023. The CHILD Care Act would end the increased deduction and dedicate the projected savings to the Child Care and Development Fund.

"We should be using federal dollars to meet the needs of working families, not for a needless tax break," said Congresswoman Suzanne Bonamici. "The Child Care and Development Block Grant Program has been underfunded for many years, and the historic demand for affordable child care makes it critical to increase funding for this essential program. I'm grateful to be working across the aisle with Congressman Meijer to support working families and increase access to child care."

"The COVID-19 pandemic presented major challenges for hardworking parents in West Michigan and across the country," said Rep. Peter Meijer. "Now, more than ever, we need to increase access to affordable childcare. The full 'three martini lunch deduction' is not the most effective use of taxpayer dollars, and it's time we repurpose these funds. Directing these resources to the Childcare Development Block Grant, which has long been underfunded, would give more childcare options to the families who need it most. I'm glad to join Congresswoman Bonamici in this critical bipartisan effort."

The legislation is endorsed by the Bipartisan Policy Center, Center for Law and Social Policy, Child Welfare League of America, Family Forward Oregon, Institute on Taxation and Economic Policy, Low Income Investment Fund, National Women's Law Center, New America's Early & Elementary Education Policy Program, and ZERO TO THREE.

The full text of the legislation can be found here.

"The Bipartisan Policy Center applauds Representatives Bonamici and Meijer for their creative work to provide child care to more children and families through the Child Care and Development Block Grant," said Linda Smith, director, Bipartisan Policy Center's Early Childhood Initiative. "The Choosing Healthy Investments and not Lunch Deductions (CHILD) Care Act of 2021 would add more than $5 billion to CCDBG without increasing the federal deficit, helping more families around the country get back to work and ensure our economy can thrive. We thank Reps. Bonamici and Meijer for working across the aisle on behalf of children and families."

"The funding generated from the CHILD Care Act is a common-sense way to add more funding to child care, prioritizing the care of our children and families over expensive business lunch write-offs," said Andrea Paluso, Executive Director of Family Forward Oregon."Our country has the resources we need to have a comprehensive child care system—we just need to prioritize it. This is one of the many steps we should take to fund child care like the essential service it is. We are so grateful for Congresswoman Bonamici's leadership and commitment to expanding access to affordable, high-quality, culturally-relevant child care."

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