Small Business Relief and Revitalization Act of 2022, cancellation of indebtedness income exempt from income tax, financial institution excise tax and corporate income tax due date extension, certain business tangible personal property ad valorem tax exemption, deposit of certified funds with Revenue in lieu of one-time surety bond for licensure, average monthly sales tax liability for estimated payments increased, Secs. 40-16-3.1, 40-18-39.1 added; Secs. 40-9-1, 40-23-6, 40-23-6.1, 40-23-7 am'd.
Impact
The bill also includes a provision for extending due dates for financial institution excise taxes and corporate income taxes, which provides additional flexibility during challenging economic periods. Furthermore, it exempts up to $40,000 of the market value of tangible personal property from state ad valorem tax, enabling local governments to adopt similar exemptions, potentially benefiting small businesses operating low-margin retail or service-type industries. These changes are designed to stimulate local economies and support the recovery of small businesses across Alabama.
Summary
SB189, also known as the Small Business Relief and Revitalization Act of 2022, aims to provide extensive tax relief to small businesses in Alabama. It primarily seeks to exempt cancellation of indebtedness income arising from loans forgiven under the federal American Rescue Plan Act of 2021 from state income tax. This provision is expected to alleviate some financial burden on small businesses recovering from the economic impacts of the COVID-19 pandemic, allowing them to retain more earnings for reinvestment or operational costs.
Sentiment
Overall, the sentiment surrounding SB189 appears to be positive among legislators and small business advocates who view it as a necessary response to the economic challenges posed by the pandemic. Supporters emphasize that providing tax relief and support is crucial for fostering entrepreneurship and ensuring the survival of small businesses. However, some dissenting voices express concerns over the long-term fiscal implications for local municipalities, which could face budgetary shortfalls as a result of lower property tax revenues.
Contention
Notable points of contention include the potential trade-off between providing immediate relief to small businesses and the sustainability of municipal funding. Critics are particularly worried that while small businesses benefit from the proposed exemptions and extensions, local municipalities may struggle to manage reduced tax revenue streams necessary for public services. The balance between state support for small businesses and local government funding remains a key area of debate, highlighting the complexities in reconciling broad economic recovery efforts with localized financial implications.
Same As
Small Business Relief and Revitalization Act of 2022, cancellation of indebtedness income exempt from income tax, financial institution excise tax and corporate income tax due date extension, certain business tangible personal property ad valorem tax exemption, deposit of certified funds with Revenue in lieu of one-time surety bond for licensure, average monthly sales tax liability for estimated payments increased, Secs. 40-16-3.1, 40-18-39.1 added; Secs. 40-9-1, 40-23-6, 40-23-6.1, 40-23-7 am'd.
Taxation, sales tax exemptions, sales and use tax exemption with local option provided for purchases of optical aids, including eyeglasses and contact lenses
A bill for an act relating to the powers of educational institutions, political subdivisions, and certain other governmental entities regarding the sale, lease, or transfer of property for educational purposes.
A bill for an act relating to the powers of educational institutions, political subdivisions, and certain other governmental entities regarding the sale, lease, or transfer of property for educational purposes.(See SF 2333.)