Senate approves bill to exempt PPP loans from state taxes | state
The Minnesota Senate overwhelmingly passed a bill On Thursday, this will protect businesses that received federal money from having to pay Minnesota taxes on it.
The measure, sponsored by State Senator Tom Bakk, I-Cook, received 55 votes in favor and 12 against.
the vote was greeted by the Minnesota Chamber of Commerce and are Senators, John Jasinski, R-Faribault and Mike Goggin, R-Red Wing.
“Thank you to the tripartite group of senators who voted today to prevent income tax from hitting small businesses that have received federal P3 loans. This is positive news for Minnesota businesses that have struggled to keep their doors open and people employed during the pandemic, ”Laura Bordelon, senior vice president of House advocacy, said in a statement. . This one-time assistance will help the 100,000 businesses that received a P3 loan continue to grow the economy and create and maintain jobs for the people of Minnesota. “
The Paycheck Protection Program was established under the massive CARES Act last year to help businesses keep workers employed as they dealt with government shutdowns enacted to stop the spread of COVID-19. Loans are canceled if used for eligible costs and 60% of loan proceeds go to payroll.
In Minnesota, the program’s footprint has been significant. Over 100,000 companies have received PPP loans, including everything from mushroom growers to dairy farmers to dentists. Treasure City, the Royalton gift shop known for its impressive array of kitsch memorabilia, received a loan of $ 28,300. Well-known local artists like Trampled by Turtles, Doomtree and Dessa have all received loans. So is KQRS radio host and podcaster Tom Barnard.
The total amount of PPP loans below $ 150,000 amounted to $ 2.7 billion.
According to data from the Small Business Administration, at least 23 lawmakers in Minnesota have received nearly $ 1.4 million in low-interest forgivable loans from the federal Paycheck Protection Program.
The federal government does not tax money. But if the legislature does not act, the money would be taxable under current Minnesota law.
“Every day I hear from small businesses and workers who relied on federal help in the form of P3s loans and extra unemployment help to go through COVID,” Goggin said. “They were put in this situation through no fault of their own, but they are now looking at huge tax bills. I’m glad we were able to give them that relief. “
Jasinski said, “These companies and workers played by the rules and did all they could to survive the pandemic and the Walz government business closures. They endured some pretty hard times. With our state budget in such good shape, we have an easy opportunity to help these businesses and workers get some relief. “
The proposal enjoys bipartisan support in the House, but the Peasant-Labor majority have yet to act on it.
State Representative Greg Davids R-Preston called on the House DFL to take action on the bill.
“Businesses are waiting for the legislature to take action and protect them from unforeseen tax bills,” Davids, the GOP leader on the House Tax Committee, said in a statement. “Unfortunately, Democrats in the House are dragging their feet and holding this important legislation hostage. With 55 votes in the Senate, it is clear that this issue enjoys strong bipartisan support.