SACRAMENTO — Today, Governor Gavin Newsom unveiled a series of new resources to aid small businesses in California amid the COVID-19 pandemic.
What you need to know:
1.Through the California Department of Tax and Fee Administration (CDTFA) the state is going to issue a 12-month sales tax reprieve for small businesses. Small businesses won’t need to pay the state sales tax receipts for one year and there will be no fines or penalties. In addition, Governor Newsom said small businesses can take upwards of $50,000 as a bridge loan from their sales taxes with no interest and no fees. This program offers what is effectively an immediate interest-free loan to small businesses, providing a bridge until businesses can get relief from the SBA or they can get back on their feet.
2. Governor Newsom highlighted the federal Paycheck Protection Program. The program offers up to $10 million in loans for business as long as they continue to pay their employees during the COVID-19 crisis. Seventy-five percent of the loan has to be used for payroll. Currently, there is $349 billion in the fund and the program will be open for applications starting Friday, April 3, 2020. Small Businesses can apply for the Paycheck Protection Program: a 100% guaranteed loan up to $10 million for employers who maintain payroll. Importantly, the program is first-come, first-serve and the Governor encourages all eligible California small businesses to contact their lender to learn more. Applications can be submitted here.
3.The Governor is also allocating $50 million to the California Infrastructure and Economic Development Bank to mitigate barriers to capital for those small businesses that may not qualify for federal funds.
Earlier this week, Governor Newsom signed an executive order to help small businesses, granting a 90-day extension for small businesses to pay sales taxes.
For the latest on the state’s COVID-19 response, visit covid19.ca.gov.