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Governor Newsom Signs Bill Giving Small Business a $6.2 Billion Tax Cut

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Governor Newsom Signs Bill Giving Small Business a $6.2 Billion Tax Cut

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n Los Angeles County, Governor visits small businesses supported by federal Paycheck Protection Program loans and announces new tax relief worth a combined $6.2 billion

SAN FERNANDO – Today, Governor Gavin Newsom signed a bill that will give small businesses hit hardest by this pandemic a $6.2 billion tax cut over the next six years – a critical lifeline that will help get our small businesses back on their feet and an important component of California’s economic recovery strategy.

“California’s small businesses have been hampered and hammered by this pandemic, and we are using every tool at our disposal to help them stay afloat,” said Governor Newsom. “Help is on the way in the form of a $6.2 billion tax cut, which will provide support, not to large publicly traded companies, but to the mom-and-pop businesses – the beauty salons, restaurants and dental offices – which have been resilient during this difficult time. This small business tax relief is exactly what is needed to keep businesses open so they can continue paying their employees.”

Under the legislation, AB 80 by Assemblymember Autumn Burke (D-Inglewood), the forgiven PPP loans that businesses received from the federal government during the pandemic will not be counted as taxable income, and these businesses can also deduct the costs of expenses that those loans paid for. This is additional state tax relief for the small businesses that have been struggling most, and may very well make a difference in their choosing to reopen, stay open, or shut down as they look to the future.

The Governor signed the legislation in San Fernando after meeting with local business owners that have utilized federal Paycheck Protection Program (PPP) loans to keep operating during the pandemic. He was joined by actor, restaurateur and Los Angeles native Danny Trejo.

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