LOS ANGELES - The pandemic has greatly impacted small businesses, forcing many to close. On Thursday Governor Gavin Newsom signed legislation providing a tax cut for small businesses.
The governor visited San Fernando business owners who have struggled through the COVID-19 and signed legislation designed to provide $6.2 bill in tax cuts for hard-hit small businesses over the next six years.
"Help is on the way in the form of a $6.2 billion tax cut, which will provide support, not to large publicly traded companies, but to the mom-and-pop businesses -- the beauty salons, restaurants and dental offices -- which have been resilient during this difficult time,'' Newsom said. "This small business tax relief is exactly what is needed to keep businesses open so they can continue paying their employees.''
Under the legislation, AB 80, forgiven Paycheck Protection Program loans received by businesses from the federal government will not be considered taxable income, and businesses can deduct expenses the loans were used to pay.
Newsom was joined in San Fernando by a host of local elected and community officials, including actor/business owner Danny Trejo and state Senate Majority Leader Bob Hertzberg, D-Van Nuys.
"Here in our own San Fernando Valley and across the state, small business is, in many ways, the soul of this state,'' Hertzberg said. "It represents the hopes and dreams and sweat and toil that forms the foundation of our California Dream. Today, with this new law, passed on a bi-partisan basis, we are taking another step closer to repairing some of the damages caused by this overwhelming global pandemic.''
The National Federation of Independent Businesses, billed as the state's largest small-business association, also hailed the law.
"The law is especially timely as small employers are now huddling with their CPA's assessing their taxes,'' said John Kabateck, state director for NFIB. "This tax relief could not have come a moment too soon. It, combined with the looming June 15 general reopening, will help to ensure California's mom-and-pop enterprises are getting back on their feet, men and women are returning to work, and our communities and public services are thriving once again.''