AB 1698 would create modest tax credit for small restaurants to offset food-handler costs

Assemblymember Alaniz introduced AB 1698, which would permit restaurants with 50 or fewer employees to claim a tax credit equal to employer costs for food-handler certification, capped at $250 per year.

Pat Joyce of the California Restaurant Association testified in support, saying the 2023 requirement that employers pay for employee food-handler cards and compensation for training time has shifted small costs onto employers and increased turnover-related expenses. "Given how challenging it is for these small businesses to keep their doors open, this bill is a small yet meaningful way to offer some relief," Joyce said.

Danny Kando Kaiser (California Tax Reform Association) opposed the bill, arguing a 100% refundable credit would amount to a direct state payment with little precedent and that compliance costs are deductible business expenses. Other industry representatives discussed alternatives and said a modest credit could help small restaurants manage rising costs.

Chair Gibson referred AB 1698 to the committee's suspense file; the author and supporters said they would press for targeted, modest relief rather than a large-scale subsidy.