Boyd Gaming Corporation, f.k.a. The Boyd Group and Subsidiaries - Page 12

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            the caption “in general”.  Immediately thereafter, under the                               
            caption “Exceptions to percentage reduction rule”, the reports                             
            state that “The bill provides certain exceptions to the                                    
            applicability of the percentage reduction rule.  First, the cost                           
            of a meal * * * is fully deductible if the full value * * * is                             
            excludable under section 132, pursuant to either the subsidized                            
            eating facility exclusion or the exclusion for de minimis fringe                           
            benefits.”  S. Rept. 99-313, supra at 71, 1986-3 C.B. (Vol. 3)                             
            at 71; H. Rept. 99-426, supra at 124, 1986-3 C.B. (Vol. 2) at                              
            124.  The same is true with respect to the second excerpt.                                 
            Reading on from the language to which respondent has referred us,                          
            we find that the report goes on to discuss the same two                                    
            exceptions that respondent would have us ignore today.  H. Conf.                           
            Rept. 99-841, supra at II-25, 1986-3 C.B. (Vol. 4) at 25.                                  
                  Based on our reading of all the legislative history, we find                         
            that the excerpts on which respondent relies do not stand for the                          
            broad proposition that she espouses.  The excerpts are merely                              
            broad rules that are limited by language that follows immediately                          
            thereafter.  Unlike respondent, we do not read the legislative                             
            history to foreclose the complete deduction of employee meals in                           
            100 percent of the cases.11  Petitioners’ deduction for their                              
            employee meals would not be limited by section 274(n)(1), for                              
            example, if section 119 allows all of petitioners’ employees to                            
            exclude the value of the meals from their gross income.  In such                           

            11 We also place less weight than respondent on the fact                                   
            that the Congress did not include sec. 274(e)(1) in its list of                            
            exceptions under sec. 274(n)(2).                                                           




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