Letter to the Editor: Small businesses don’t deserve taxes on PPP loans
Published 6:30 am Wednesday, May 12, 2021
It’s no surprise that over the past year, Minnesota businesses faced numerous difficulties as a result of the ongoing COVID-19 pandemic. In order to stay afloat, more than 100,000 Minnesota businesses opted to take part in the federal government’s Paycheck Protection Program (PPP), which provided vital loans to help ensure employees were paid and small businesses’ doors remained open.
The federal government did not intend to tax these loans and Minnesota businesses took out these loans in good faith understanding that they would not be taxed. However, in Minnesota — a state whose tax laws do not automatically conform with federal tax regulations — businesses are facing an unexpected, hefty tax on their PPP loans.
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In states with similar tax laws to ours, state governments have taken vital steps to ensure businesses are not taxed for their PPP loans, and Minnesota must do the same before it’s too late.
With so many small businesses already closing in the past year due to complications from the pandemic, Minnesota cannot afford to create any further complications for businesses across the state or unfairly punish them with an unnecessary, burdensome tax.
Minnesota’s Senate passed legislation to make sure businesses are not taxed for their PPP loans on a strong bipartisan vote earlier this session. As Austin area Chamber of Commerce president, I urge our House of Representatives to do the same immediately for the sake of Minnesota businesses. We must stand up for Main Street, protect our small businesses and fight for a strong economic recovery that benefits all of Minnesota.
President, Austin Area Chamber of Commerce