TRENTON - If a bill approved by the Senate Economic Growth Committee on Thursday becomes law in mid-January, small businesses in New Jersey will receive tax relief from the state that covers their minimum wage workers.
The proposed tax credit-S3759/A5735-will apply to the 2020 and 2021 tax years. This is equivalent to 10% of the wage paid to employees whose hourly wage does not exceed 20% of the minimum wage, or $14.40 per hour for most workers. Its upper limit is half of the corporate tax bill.
Retail businesses with fewer than 100 employees can obtain this credit; healthcare and social assistance; arts, entertainment and leisure; accommodation and catering services; or other services.
Christopher Emiholz, vice president of government affairs at the New Jersey Chamber of Commerce and Industry, said that this kind of help is welcome because it was not easy to run any small business in New Jersey even before the events of the past 21 months.
He said: "Then you put it on top of the impact of the COVID pandemic." "In addition to the labor crisis we are experiencing, small businesses can't find anyone. Except for many of these small businesses... It has also been affected by the increase in the minimum wage."
The minimum wage for most employees in New Jersey will increase from $12 to $13 on January 1, 2022, and it will increase by $1 each year.
"Guess what? The minimum wage increases by about 10% every year. Therefore, we are helping small businesses pay for things that the legislature considers important," Emiholz said. "... This bill will benefit small businesses that are struggling with COVID, struggling with the minimum wage, and struggling with the labor crisis, just because we know that New Jersey is not for our small businesses. It's always so easy to cause."
A clause was removed from the bill that would increase credit to 20% in counties where the unemployment rate exceeds the state unemployment rate.
Michael Symons is the Director of the 101.5 State Assembly in New Jersey. Contact him at michael.symons@townsquaremedia.com.