Boulevard and the Professional Beauty Association have partnered to push for an extension of FICA Tax Tip Credit to self-care businesses. The joint fundraising initiative will help pass bipartisan tax legislation in support of continued growth and investment in the beauty industry.
Boulevard is provider of the client experience platform purpose-built for appointment-based, self-care businesses. The Professional Beauty Association (PBA) is the national trade association supporting the entire beauty industry. Last week, they announced the launch of a joint fundraising initiative aimed at helping pass bipartisan legislation to extend the existing 45B Federal Insurance Contributions Act (FICA) Tax Tip Credit to the beauty industry.
Demonstrating its continued support for the self-care businesses it serves, Boulevard is donating $2,500 to the PBA’s Issue Advocacy Fund (IAF) while also providing a dollar-for-dollar match on subsequent donations to the fund up to an additional $2,500.
Originally passed in 1993, the 45B FICA Tax Tip Credit allows restaurants to claim a dollar-for-dollar credit on the employer portion of FICA taxes that businesses pay on tips employees receive directly from their customers, saving the industry millions of dollars annually.
In the 30 years since its passage, the credit has not been extended to include self-care businesses such as hair salons, nail salons, barbershops, spas, and medspas, despite their comprising the nation’s second-highest tip-generating industry.
Unbeknownst to most consumers, self-care businesses are taxed on gratuity, with salon and spa owners paying $0.76 for every $10 of tips collected – a significant burden not shouldered by the restaurant industry.
Extending the FICA Tax Tip Credit to the beauty industry would have an especially profound impact on women, minorities, and small business owners.
Self-care businesses provide one of the most reliable career paths for underrepresented groups, with salons, barbershops, and other establishments employing middle-class women and minorities at a rate that is more than double the national average. Additionally, 60% of employment based-salons are women-owned.
All proceeds raised through its joint initiative with Boulevard will go directly to cover lobbying efforts and other costs necessary to support the passage of the FICA Tax Tip Credit.
The matching program sponsored by Boulevard will run through May 31, 2023. Donations can be made by visiting probeauty.org/blvd.