The New Mexican Legislature is attempting to help the state’s small businesses with three recently introduced bills, but according to a business leader, they miss the mark.
Senate Bills 1, 2 and 3 are the latest legislation geared toward offering relief to businesses struggling to survive the COVID-19 crisis.
The first bill would provide a temporary break for restaurants through a gross receipts tax deduction.
New Mexico Business Coalition President Carla Sonntag said she supports this bill because restaurants have been hit hard, but would like to see some consideration for the countless other businesses that are still hurting because of the shutdown.
“That is a good first step, but it’s only for the restaurant industry so it doesn’t encompass all the other businesses that are struggling now,” Sonntag told The Center Square.
Sonntag said she would like to see tax relief measures that are inclusive of other businesses. She points to the sector of businesses that haven’t been able to open at all.
“On the businesses that have never been able to open, I mean in any capacity, we’d like to see them get some relief as well,” Sonntag said. “So that would not be through gross receipts because they have no gross receipts.”
One example of those businesses is amusement parks, she said. They still have to pay property taxes, utility bills and other expenses but they can’t make money, Sonntag said.
Senate Bill 3 is a renewal of the Small Business Recovery Act with a few modifications. The act makes small business recovery loans available again, and this round extends the application deadline among other things.
The bill’s sponsor Sen. Jacob Candelaria, D-Albuquerque, said it will make $500 million available to small businesses over the next two years, according to KRQE.
Sonntag said the effort is appreciated, but there is not a big appetite for loans among businesses right now, even small or low-interest loans.
“The overriding theme that we got back from business owners of all types is that they don’t want more debt right now because their future is so incredibly shaky because of this continued lockdown,” Sonntag said. “What all businesses want more than anything is to be able to safely open, or open to a larger capacity.”
Last year, the Legislature set aside $400 million for loans, but very few businesses participated in the program, Sonntag said. This year’s incarnation tries to fix some of the complexity that contributed to last year’s flop, but that effort will be wasted if businesses don’t feel secure enough to take on debt, she added.
Along with providing tax relief, Sonntag notes the Legislature should avoid adding burdens to businesses.
“So those bills that are looking at government mandates: paid sick leave and family leave and things like that,” Sonntag said. “Definitely, it’s a conversation worth having, it’s just bad timing right now on businesses that are hurting so severely.”
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