Lawmakers said they had reached a deal to lower tax bills for businesses that received state and federal allowances amid the pandemic, and also help some unemployed workers, but they will need to act. quickly as tax deadlines loom.
Senate Speaker Karen Spilka, House Speaker Ronald Mariano and Ways and Means Committee Chairs, Representative Aaron Michlewitz and Senator Michael Rodrigues, said in a joint statement that the bill would “reignite” the recovery. pandemic.
In a preview of the bill that has yet to be released, lawmakers said they would exempt businesses from tax on canceled loans from the Paycheck Protection Program, freeze unemployment rates at two years, waive fees and some taxes for some unemployed workers and extend paid vacation pay.
The announcement came just hours after a group of bipartisan lawmakers and the Massachusetts Fiscal Alliance came together to pressure legislative leaders to take action to help businesses pay millions in taxes on PPP loans.
As lawmakers explained in their statement, “time is running out” as the tax bills of thousands of small businesses in Massachusetts fall due in less than a week on March 15. Small Massachusetts businesses organized as flow-through entities owe about $ 130 million in federal P3 loans, according to state budget chief Michael Heffernan.
In an effort to help businesses “stay afloat and save jobs,” lawmakers said the bill would remove taxes on loans canceled by the federal government.
Lawmakers have promised “to act quickly,” but have offered no specific timetable.
“There has to be a significant sense of urgency,” Rep. David DeCoste, R-Norwell, told the Herald.
Outlines of the deal provided by lawmakers indicate that the bill would give tax relief to unemployed workers with incomes below 200% of the poverty line, or $ 53,000 for a four-person household. He reportedly waived penalties for missed tax payments for people receiving unemployment benefits. It would guarantee paid leave for workers with COVID-19, who are in quarantine after exposure or who have to take time off work to get vaccinated, and provides a mechanism for reimbursing employers.
The bill would also freeze the unemployment insurance rate schedule until 2022 – another tax on employers that was set to climb in April as the state continues to draw from its now more than $ 4 billion unemployment account. dollars in arrears.
Gov. Charlie Baker introduced a separate bill that would halt unemployment insurance rate increases and allow up to $ 7 billion in borrowing to pay off federal loans. The governor also signaled last week his support for lifting taxes on pandemic relief for businesses.
Senate Majority Leader Bruce Tarr at a press conference Monday said lawmakers should “leave no stone unturned” to help the state’s hard-hit small businesses survive.
State Treasurer Deborah Goldberg reported last week that 13% of state trading licenses, including manufacturers, wholesalers and shipping companies, have not been renewed. Up to 5% of restaurant and hotel licenses have not been renewed, “a number much lower than we originally thought,” she said.