Senator Jeff Timberlake on Taxing PPP Loans
Hello, I am Senate Republican Leader Jeff Timberlake
Talk of the state budget dominated our week in Augusta as legislative committees began their meetings and the Appropriations Committee heard testimony about how much money state government may need in order to close out the current budget year that ends on June 30.
The piece that garnered the most attention had to do with the federal Paycheck Protection Program, or PPP, that provided “rescue resources” to small businesses and then forgave most of them by turning them into grants.
Congress intended for these benefits to be tax free, but Governor Mills’ most recent proposal would have cost Maine’s PPP recipients $100 million or more, leaving Maine’s tax code out of sync with federal law.
Cutting through all of this rhetoric, the issue comes down to this: Which of these two entities can more easily absorb a $100 million in expenses?
The working people of Maine or the government?
I say the money is best left with the working people and not the government.
The Governor’s Finance Commissioner told the Legislature that without the new tax on small businesses, she could not balance the state budget. We disagree.
Budgets can always be balanced when those doing the work are willing to make the difficult decisions. As difficult as reducing state spending might be, the choices faced by small businesses, caused by the government restrictions on their businesses, are far greater.
This could be the difference about whether they make it or not to the summer.
The working people of Maine are what keeps our government afloat.
Maine’s small businesses employ three quarters of all the working Mainers.
They pay $23 billion in wages each year.
By paying income taxes, sales taxes and other things they buy, and in countless other ways, those businesses and their workers keep state government solvent.
Business owners, workers, vendors, customers, and their families are the backbone of our economy; and they have been through the worst economic year of their lifetimes while finding ways to survive even with all the government restrictions.
At the same time, the sacrifice of state government has amounted to things like cancelled travel plans, not filling vacant positions, and moving some money out of the state liquor contract, but hardly anything that one might equate with the struggle Maine people have endured.
For that reason alone, we are encouraged by the Governor’s decision to consider leaving the PPP money where it is and find other ways to balance the state budget.
Again, I am Senate Republican Leader Jeff Timberlake.
Stay warm and stay safe this weekend. Thank you.