Gavin Newsom unveils sales-tax deferral to help businesses hurt by COVID-19 restrictions

California Gov. Gavin Newsom on Monday unveiled a raft of initiatives aimed at helping small businesses and nonprofits that are struggling under state COVID-19 restrictions.

“As more and more counties move into the Purple Tier and we look at our own modifications statewide, not just those modifications we are seeing at a local level, we have to be more mindful than ever about the economic impact and consequences of these further restrictions,” Newsom said at his press conference.

Headlining the proposals is an effort to give businesses billions of dollars in sales tax deferrals.

Newsom announced that small businesses, with less than $1 million in sales tax, will be granted an automatic three-month extension on payment.

“In essence a float,” Newsom said. “You can hold that money. You can use that money to float any obligations you have.”

In addition, the state will expand interest-free payment agreements for businesses with sales up to $5 million, Newsom said.

The Democratic governor also announced that, in partnership with the Legislature, the state will be giving out $500 million in COVID-19 relief funds, with grants up to $25,000 for small businesses and nonprofits.

The governor said that that money is intended to cover the next few weeks, until the new Legislature can meet and work with Newsom’s office to take further action.

“So I want folks to know, this is not the end (of assistance.) This is just the beginning of a bridge,” Newsom said.

More information about programs available to help businesses is available at covid19.ca.gov/business-and-employers.

This story was originally published November 30, 2020 at 1:39 PM with the headline "Gavin Newsom unveils sales-tax deferral to help businesses hurt by COVID-19 restrictions."