As the state readies for full reopening this month, questions persist on how bills currently in the legislative process may help or hurt sustainable recovery from the economic impact of the Covid-19 pandemic.
Main Street businesses that haven’t been able to resume normal operations aren’t prepared to pay for additional leave programs, John Kabateck, California state director with the National Federation of Independent Business (NFIB) told the Northern California Record.
“Without question, it would mean higher costs, administrative burden, and the threat of frivolous lawsuits,” Kabateck said.
The NFIB noted that California already has 17 leave programs, including the recently enacted SB 95, which is scheduled to last until the fall.
One more – AB 995 – would further pressure small businesses, Kabateck said.
“Bureaucrats, unions, and lawyers will prey on small business with new leave requirements,” Kabateck said. “These costly leave programs are indeed taxes on small business owners that will be dismantling the recovery of those trying to crawl out of the hole, and will create an even bigger crater that will negatively impact our struggling job creators.”
Three separate bills also address reform of the California Minimum Franchise Tax, an annual fee all businesses must pay to the state: AB 91, sponsored by Assemblywoman Suzette Valladares, R-Santa Clarita; AB 632, sponsored by Assemblymember George Ramos, D-Highland, and AB 664, sponsored by Assemblymember Frank Bigelow, R-Madera.
“The Minimum Franchise Tax sends the wrong message to businesses that are trying to get started or sustain, and a big concern we’ve had all along is no one knows where the money is going,” Kabateck said. “Why on earth are we asking small business to send their scarce, hard-earned dollars into a state abyss where we never know its outcome? It needs to be investigated and there needs to be more transparency.”
Gov. Gavin Newsom has said he will not raise taxes this year, Calmatters reported.
“We are encouraged the governor does not have an appetite for new taxes,” Kabateck said. “And we hope our policymakers in Sacramento see the robust state coffers and spend those dollars as a small business owner would – pay down debt, save money for reserves, and don’t run up credit cards with foolish spending we’ll regret later.”
Lawmakers are to act on bills that have been introduced by this Friday.