A legislative body on Monday approved a 10-bill package to help small businesses recover from the pandemic, including $ 100 million in federal funding and a number of additional tax breaks.
No estimate was made of how much revenue the state would forego if it approved the tax breaks. This includes a 1% corporation tax credit on a company’s bill for work given to small businesses in New Jersey, those with fewer than 50 employees.
“We believe that any lost corporate tax revenue will be returned to the state and communities through revenue generated from new or additional work for our small businesses,” said Rep. Gary Schaer, D-Passaic. “According to reports, the recovery of small businesses could be delayed until 2023 without immediate financial support.”
Denise Blasevick, co-founder and executive director of The S3 Agency, a public relations and advertising firm in Boonton, said the tax credit would help businesses, small businesses and communities whose residents remain employed and financially secure.
“Every day we fail to find a way to sustainably rebound our small businesses, we risk losing more of those small businesses,” said Blasevick.
Other proposed tax changes:
- Temporary VAT exemption for wintering small businesses, retroactive to last September;
- Corporate and income tax credits for modernizing non-residential buildings such as disinfecting lighting, infrared thermometers and ventilation;
- When restaurants accelerate depreciation of up to $ 150,000 in investments to meet COVID-19 health regulations, including heaters and overhangs.
Rep. Roy Freiman, D-Somerset, said restaurants are “creative, resilient, but they also need help.” The change would reflect the latest federal tax law, he said.
“This would basically bring in the New Jersey Tax Act and say, you know, small businesses, we’re going to allow you to run this up so you can take that write-off right now, which basically allows you to get that cost back faster, because they deserve it. Said Frieman.
Here is the full invoice package:
- A4634 Allows corporate tax credit for subcontracting small businesses in New Jersey.
- A4918 Allows companies to hold general meetings. This was allowed in an emergency at the start of the pandemic, and the current proposal would make it permanent.
- A4958 Offers temporary sales tax and use tax exemption for wintering certain small businesses.
- A5218 Allows certain restaurant owners to expedite the depreciation of certain corporate business expenses and gross income taxes.
- A5389 / S3305 Enables gross income tax credit for home improvement expenses to reduce the spread of COVID-19. This has already been approved by the Senate, but expanded on Monday so it would have to go back there for another vote.
- A5443 Provided US $ 25 million federal funding to the EDA to support small businesses in need.
- A5444 Provided US $ 35 million federal funding to the EDA to support food and beverage companies in need.
- A5445 Provided US $ 10 million federal funding to the FDFA to support child day care centers in need.
- A5446 Provided US $ 15 million federal funding to the EDA to support businesses and nonprofits in need.
- A5447 Provided US $ 15 million federal funding to the EDA to support arts and cultural organizations in need.
Business groups praised the package, saying they hope the Senate will pick it up soon.
“That is exactly what we asked for,” said Michael Egenton, executive vice president of government affairs for the New Jersey Chamber of Commerce. “This rebuilding process is going to take some time, but you are starting to put together some initiatives that will help our small business members on Main Street.”
Christopher Emigholz, vice president of government affairs for the New Jersey Business and Industry Association, said the state economic development agency had “done a fantastic job” and will now be able to do more.
“The only problem I would have with anything the EDA did is that they weren’t given enough money,” said Emigholz. “When we know that federal funds are coming in – we hear it’s going to be about $ 6 billion today, the governor said at his press conference – we know we can afford it. We could probably afford more. “
Anthony Pizzutillo, government affairs advisor for the New Jersey Chapter of the National Association of Industrial and Office Properties, said the bill to provide tax credits for non-residential construction work will help as office building occupancy remains between 10% and 15% across the state .
“We need to get our employees back into our employment offices so we can be productive again and get our economy going again,” said Pizzutillo.
Michael Symons is the head of the State House office for New Jersey 101.5. Contact him at [email protected].
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