After turning age 65, Robert retired from his long-time job, and his employer presented him with a gold watch at a retirement dinner. The watch cost the employer $200.

While $200 might not seem de minimis within the meaning of § 132(e), the 1984 legislative history accompanying the enactment of $132 gave as an example of an excludable de minimis fringe the gold watch presented to an employee at his retirement, so Robert excludes the $200 value from his Gross Income.

How much can Robert's employer deduct under $162? Please explain.