California Legislature Passed ‘One Of The Largest Tax Cuts In State History’ To Aid Struggling Businesses - Trendy Topics

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Friday 1 October 2021

California Legislature Passed ‘One Of The Largest Tax Cuts In State History’ To Aid Struggling Businesses


The California State Legislature passed Assembly Bill 80 on April 26 to aid struggling businesses who received the Paycheck Protection Program (PPP) amid the COVID-19 pandemic. 

Intending to provide a helping hand to struggling businesses in California, the legislature has passed Assembly Bill 80 on April 26 to keep small businesses open and employees compensated. 

Lawmakers approved the bill on April 26 to safeguard the financial future of small California businesses by providing up to $6 billion in tax cuts for any business who has received PPP loans and provides evidence of a 25 percent loss in business during the pandemic, according to the legislation. 

California legislators passed a unanimous vote on the bill, “marking it as one of largest tax cuts in state history,” California State Assemblymember Autumn Burke mentioned in a FaceBook post.

For the past two months, Senate Bill 265, led by Senator Borgeas, aimed to protect jobs and save struggling California businesses, providing full federal conformity for all businesses that collected PPP loans. 

See Related: Santa Clarita Small Business PPP Loans May Not Be Provided Tax Forgiveness By State

“Frustrated small businesses have been waiting months for a solution. I applaud Senator Borgeas for bringing this idea to the table and for the legislature for getting behind this bipartisan effort to help our struggling job creators,” said Senator Scott Wilk. “What we passed today provides a solution for many small businesses who are struggling to get back on their feet. As I’ve said in the past, a win for bipartisanship is a win for our small business community because good ideas shouldn’t have party lines.”

“It looks like it’s going to total about 6.2 billion dollars in tax cuts and I’m surprised that they were willing to give up that much,” said Matt Denny, a Certified Public Accountant in Santa Clarita. 

Forgiving loans would mean that the state gives up a 9-12 percent profit return, which California is “unlikely to do,” said Denny in a previous KHTS article. 

Alongside Assembly Bill 80, California legislated $2.5 billion in fiscal relief to support California’s reopening earlier this year, providing eligible businesses an opportunity to receive grants up to $25,000 to make up for losses caused by the pandemic. For more information, click here

For more information on small business financial relief under Assembly Bill 80, click here.

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