California Governor Gavin Newsom has authorized new tax relief and grants to businesses impacted by COVID-19 restrictions. The Bureau of Automotive Repair (BAR) is encouraging licensees to determine their eligibility for relief, which includes the following:
Tax Relief for Businesses Impacted by COVID-19
The Governor will direct the California Department of Tax and Fee Administration to do the following:
- Provide an automatic three-month extension for taxpayers filing less than $1 million in sales tax on the return and extend the availability of existing interest and penalty free payment agreements to companies (with up to $5 million in taxable sales).
- Broaden opportunities for more businesses to enter into interest-free payment arrangements.
- Expand interest-free payment options for larger businesses particularly affected by significant restrictions on operations based on COVID-19 transmissions.
$500 Million for New COVID Relief Grant for Small Business
The Governor announced the creation of a $500 million COVID Relief Grant administered by the California Office of the Small Business Advocate (CalOSBA) at the Governor’s Office of Business and Economic Development for small businesses that have been impacted by COVID and the health and safety restrictions. Funds would be awarded to selected intermediaries with established networks of Community Development Financial Institutions to distribute relief through grants of up to $25,000 to underserved micro and small businesses throughout the state by early 2021. Non-profits would also be eligible for these grants. CalOSBA is establishing the program and will make it available to small businesses as soon as possible – for updates on availability visit business.ca.gov.
Increase Funding for the California Rebuilding Fund by $12.5 Million
The Governor announced the opening of the California Rebuilding Fund, which makes available $25 million to help impacted small businesses rebuild from the economic crisis and keep local economies strong. This program is built to be a resource in the market for the next year as businesses pivot and recover.
An increase of $12.5 million would allow the Fund to be fully capitalized. The additional funding will help the 3rd party administrator of the fund raise $125 million to make more low-interest loans to small businesses with less access to loans from traditional banking institutions.