Professor Mark J. Perry's Blog for Economics and Finance
NEW YORK -- At the Greenwich Village restaurant Commerce, cash is off the menu. In the latest encroachment of credit and debit cards onto the greenback's turf, the high-end New York City restaurant said goodbye to dollars and cents this week. The message to diners: Tip in cash if you wish, but otherwise, your money is no good here. New York magazine ridiculed the restaurant, saying it should rename itself "e-Commerce."
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
9 Comments:
Is that actually legal? I thought the definition of legal tender (such as cash) was that it could not legally be refused when proffered to satisfy a debt.
Hmmm, sounds dubious to me considering what it says on each and every type of denomination issued by Uncle Sam: "This Note Is Legal Tender For All Debts, Public And Private"...
What can the restaurant do if you decide to force their hand and hand them cash for the bill?
The excuse in the article is that it pleases the IRS is about as lame as can be...
Laugh if you want to, but I have been giving my clients who pay in gold coin a discount for my services, with pleasure. More at:
http://wjmc.blogspot.com/2010/06/gold-accepted-as-payment-for-services.html
Thank you for the opportunity to comment...
juandos,
Been there, done that. Businesses have to accept payment in dollars but not necessarily cash. That means businesses in the U.S. cannot ask you to pay in francs or pesos. They get to set the terms of payment, and you can walk if you don't like it.
They also do not have to accept payment in pennies for traffic fines even if they are rolled. I found that out the hard way trying to protest a traffic ticket in Toledo, Ohio. Those Buckeyes just don't have a sense of humor down there. They did offer me a room in their jail if I did not like it.
"Businesses have to accept payment in dollars but not necessarily cash"...
Well Walt G that's NOT the case locally with a St. Louis resturant who tried that nonsense...
They took our cash (over $460 for 12 of us) after hemming and hawing...
What it says on the bill is the law...
Juandos,
State law maybe, but no there are federal statutes on having to accept cash according to the U.S. Treasury.
Cash
Hey Walt G thanks for that link...
i think this has a great deal to do with new york regulations on restaurants and the egregious estimated tax bills that can be slapped on them.
desk audits can be used to "estimate" cash revenue and profit which is then taxable even without evidence that the sales were actually made. they use metrics like "you used more pizza boxes, so you must have sold more pizza".
the onus is on the restaurant to prove that they didn't sell it.
coyote has an excellent discussion here:
http://www.coyoteblog.com/coyote_blog/2010/06/the-record-keeping-tax.html
Actually if the business had a cash register that made an unmodifiable record of sales that would work. Consider the folks on the gulf coast who work off the books on a cash basis, who now can't prove that income when the apply to be reimbursed for the spill. In a restaurant situation in addition what part of cash tips do get reported?
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