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    Casual-Dining Segment's Sales Up in First Quarter

    Income-tax rate reductions, larger rebates contributing to trend.

    NEW YORK -- Casual-dining restaurants are estimated to have increased their same-store sales by an average of 4.1 percent in March, compared to the March 2003 result of 1 percent same-store sales growth that tied for the seventh-highest month of last year, reported the New York-based Nation's Restaurant News.

    The estimated comparable-restaurant guest count change for March 2004 was 3.1 percent, which compares with the 1.8 percent decline in March 2003. In March 2004, same-store sales and same-store guest counts both grew in all four weeks.

    The casual-dining sector has done exceedingly well in the first three months of 2004, in part owing to easy comparisons, income-tax rate reductions, larger income tax rebates, low interest rates and an increase in the refinancing of home mortgages in February and early March.

    Despite current strong growth, value propositions for the majority of concepts will continue to be very important. The share of total income generated by wages and salaries is just over 50 percent -- the lowest level in the past 50 years. Lower taxes are more accountable than wage income for an increase in disposable income to rise faster than wage income is.

    However, that situation is more pronounced in high-income households, which pay more of their taxes in recently decreased lower-income households, which pay most or all of their taxes in payroll taxes, which have held steady.

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