Coronavirus relief plan could include tax breaks for businesses offering paid sick leave
Businesses that give their employees paid sick leave during the coronavirus may get tax credits for doing so under a package of bills in the House of Representatives to help people and businesses during the COVID-19 pandemic.
The House is likely to vote on a bill Thursday to help people during the pandemic, which is expected to include paid sick leave, widespread free testing, food aid and more.
California freshman Rep. Josh Harder, D-Turlock, introduced a bill Thursday to make sure businesses who grant that sick leave are not fronting the entire cost. Instead, the bill would allow affected employers to claim a 90 percent tax credit of the qualified sick leave wages paid to employees who miss work because of the coronavirus.
“Businesses want to offer these benefits, but they’re already seeing their business profits sinking because people are staying home,” Harder said. “This is both a public health crisis and an economic crisis, and this addresses both at the same time.”
It would be capped at $7,156 per employee per year and $500 per sick day. For a minimum wage employee, the cap would cover up to 12 weeks of paid sick leave.
The tax credit would only cover employees who had a doctor’s note explicitly saying they were out of work due to coronavirus. But it would be available to all businesses, not just ones newly required to offer paid sick leave or small businesses.
Harder cited a conversation he had with a small businessman in his district, who expressed concern that offering paid sick leave to his 10 employees if they got sick at once could run him out of business.
“We need to make sure businesses aren’t suffering for doing the right thing,” Harder said.
Harder said he is working to include his bill in the larger package the House is considering. Harder said he knows his bill is a priority for House Speaker Nancy Pelosi, D-San Francisco, but Pelosi’s office did not respond to a request on the likelihood of Harder’s bill making it into the broader help package.
The White House has not indicated its opposition to Pelosi’s broader coronavirus help package. Trump has been pushing for a payroll tax cut to help the economy during the coronavirus, including in his address to the nation Wednesday night, and the payroll tax cut is not included in this package.
“I think this is both pro-worker and pro-business,” Harder said of his own bill. “Whatever your party affiliation is, I think the president should be able to support this.”
The tax credit would complement requirements that businesses provide paid sick leave to workers affected by coronavirus, already a part of the larger bill being considered by the House Thursday. It mandates that employers provide 14 days of paid sick leave in the event of a public health emergency like coronavirus.
Congress and Trump passed an $8.3 billion package last week to combat the spread of the pandemic, which included funding for prevention, vaccine development and medical supplies. There are currently 1,323 confirmed cases of coronavirus in the U.S., according to a Johns Hopkins tracking database.
Harder acknowledged the tax credit could get expensive, but said if it were implemented early enough it would help keep costs down.
“Cost depends on how much the virus spreads,” Harder said. “If this works it will stay cheap, but if it’s a month from now it will be more expensive.”
This story was originally published March 12, 2020 at 9:51 AM.
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