Start Taxing Perks, Urges Rutgers Newark Professor

It’s time to reform payroll tax laws to take into account employee perks like free gourmet meals and yoga classes, according to an upcoming article co-authored by a professor from Rutgers Business School, Newark and New Brunswick.

The article, by Rutgers Newark professor Jay Soled and Kathleen DeLaney Thomas of the University of North Carolina School of Law, will appear in the Washington University Law Review, Rutgers Newark reports. In the Law Review article, Soled and Thomas argue that employee perks and benefits are costing the U.S. billions in lost tax revenues. They believe that laws should be revamped to address the issue of perks and benefits going untaxed.

Soled and Thomas also wrote about this topic on The CLS Blue Sky Blog late last year. In that post, they explained that Congress decided 25 years ago that fringe benefits are tax-exempt. But since then, some companies have started offering perks that go well beyond “coffee and doughnuts in the break room.” Instead, think “free gourmet meals, smartphones, massages, yoga classes, dance lessons, and all-expenses-paid vacations, including plane fares, hotels, and rental car use.”

Soled discusses this issue and some options for enacting reforms in a new video from Rutgers Business Insights.

Soled is the director of Rutgers Newark’s Master of Accountancy in Taxation program. His publications include the Journal of Taxation, American Journal of Tax Policy, Virginia Tax Law Review and Georgetown University’s Tax Lawyer. According to his faculty bio, his research interest include “enhancing tax compliance and simplifying the Internal Revenue Code.”

regions: New York City

About the Author