California Senate Bill SB1447

California 2019-2020 Regular Session

• Introduced: 2/21/20
• Refer: 3/12/20
• Refer: 5/5/20
• Refer: 5/11/20
• Report Pass: 5/20/20
• Engrossed: 6/11/20
• Refer: 6/18/20
• Refer: 7/27/20
• Refer: 8/6/20
• Report Pass: 8/12/20
• Refer: 8/30/20
• Report Pass: 8/30/20
• Enrolled: 9/1/20
• Chaptered: 9/9/20
• Passed: 9/9/20

Caption

Income tax: sales and use tax: credit: small business.

Impact

The bill amends several sections of California's Revenue and Taxation Code to facilitate this tax credit system. Qualified small business employers are defined as those employing 100 or fewer people and experiencing a significant drop in gross receipts during specified periods due to the pandemic. The legislation aims to ease financial strains on these businesses, ensuring their sustainability and promoting job creation at a critical time in California's economy.

Summary

Senate Bill No. 1447, introduced by Bradford, is designed to provide tax relief to small businesses in California, particularly in response to the economic disruptions caused by the COVID-19 pandemic. The bill allows qualified small business employers to claim a tax credit against personal and corporate income taxes based on their net increase in qualified employees. Specifically, businesses can receive $1,000 for each new hire, capped at $100,000. This provision aims to incentivize employment growth as a means of economic recovery.

Sentiment

The general sentiment surrounding SB 1447 is predominantly positive, as it is viewed as a necessary measure to support small businesses and foster job growth amid the ongoing economic challenges. Stakeholders, including both sides of the political spectrum, recognize the importance of assisting small enterprises as they navigate recovery from the pandemic's impacts. However, some concerns exist regarding the implementation and accessibility of the program for smaller entities.

Contention

Despite the holistic support for SB 1447, points of contention may arise regarding the distribution of credits and the criteria for qualification. Critics have called for clearer guidelines and better outreach to ensure that the benefits of the credits reach the full spectrum of small businesses in different sectors. As the legislation requires businesses to make an irrevocable election regarding their credits, questions about the long-term implications for tax policy and small business growth remain at the forefront of discussions.