COVID-19 – the virus and the shutdown – have been incredibly difficult for all of us. I lost my father-in-law to the virus, shocking my family and imprinting 2020 on my heart as a year of suffering, sadness, and loss. Because of that, emotion wells up in me pretty quickly when COVID’s lasting impact is the subject.
This week I swallowed hard when business owners stepped to the microphone, flanked by a bipartisan group of state legislators, to support House Bill 334, a tax relief bill for the businesses. The owners told how their livelihoods had been rocked and how the federal Paycheck Protection Program (PPP) had been a lifeline to keeping them afloat and their employees on the payroll. Lawmakers’ support of House Bill 334 means North Carolina would join other states in allowing the owners to deduct expenses related to PPP. As David Bass reported for Carolina Journal:
At the federal level, both PPP loan amounts and expenses are tax exempt. North Carolina is one of only three states — joined by California and Hawaii — that does not allow a state tax deduction for both loan income and expenses.
House Bill 334 would change that by coupling North Carolina’s tax treatment with the federal approach. It’s estimated the tax change will result in a $600 million cost to the state over three years.
The bill passed second reading on the House floor in a 111-2 vote and will be voted on a third and final time on April 20.
I urge you to listen to these three compelling stories. On the personal side, they offer insight into the burden these owners have withstood. On the policy side, their stories showcase the tax issue that lawmakers are seeking to address.
First is Katy Creech, co- owner of The Glass Jug Brewery in Durham. She says that without the tax relief, it’s like the state is asking for money she was required by the feds to spend.
Next is Doug Warf, president of O2 Fitness, which has 16 gyms across North Carolina. He is the founding member of the North Carolina Fitness Alliance. He characterizes the health and fitness industry in North Carolina has having been “decimated” by COVID-19.
Now take a listen to Jason Smith. He and his wife own Cantina 18 in Raleigh and Harvest 18 in Durham. He says that despite doing curbside service, he was losing over $2,000 per day.
Mr. Smith says it will take at least another year for him to get back to where he was before the pandemic. That is heartbreaking. Jason Smith, Doug Ward, and Katy Creech are the real voices of the COVID-19 pandemic and shutdown in North Carolina. We know they are tenacious. May they also be blessed with strength.