California Governor Offers New COVID-19 Relief Package for Small Businesses — What’s In It

Samantha McDonald
·2 min read
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The governor of California has unveiled new measures to help prop up small businesses that are struggling to make ends meet amid a surge in COVID-19 cases that has led to renewed lockdowns across the state.

During a press conference yesterday, Gov. Gavin Newsom announced that companies filing less than $1 million in sales taxes will be granted an automatic three-month extension of the income tax payment deadline. He also revealed that small businesses as well as nonprofits could apply for grants of up to $25,000 each, taken from the state’s pool of $500 million in reserve funds.

According to the governor, the initiatives are designed to bolster restaurants, boutiques, hair salons and other shops that have been disproportionately impacted by the coronavirus pandemic. A statement from his office indicated that California is home to 4.1 million small businesses, representing 99.8% of all companies in the state and employing 7.2 million workers, or 48.5% of the its total workforce.

“California’s small businesses embody the best of the California Dream, and we can’t let this pandemic take that away,” Newsom said. “By providing potentially billions in immediate relief and support, our small businesses can weather the next month as we continue partnering with the legislature to secure additional funding and investments in small businesses in the new year.”

In the state’s most populous county of Los Angeles, renewed stay-at-home orders that took effect on Monday pose a threat to thousands of businesses. Fifty other counties in the state — representing 99% of California’s entire population — are currently in the most restrictive purple tier, which means retail stores must limit capacity to 25%, as part of the governor’s Blueprint for a Safer Economy.

The tax relief and grants have been introduced at a time when many Americans are still awaiting a federal stimulus package. Congressional leaders, however, have yet to reach a consensus on a deal that would address issues including the dollar amount of unemployment benefits and protections for small businesses, as well as funding for states and cities plus money for COVID-19 testing. According to recent media reports, a bipartisan group of senators has introduced a $908 billion proposal in an attempt to crack the months-long partisan impasse over providing emergency relief to the ailing United States economy.

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