The Senate unanimously approved a coronavirus stimulus package worth $2 trillion to provide emergency funding relief for those affected by the COVID-19 pandemic, out of which $9.5 billion goes to USDA for affected food producers. Stimulus provisions are targeted at food producers and workers in the entire food supply chain, from agricultural producers to transporters and restaurant workers. However small and independent restaurant owners have been left out of the stimulus package and have collectively expressed dismay. What does this stimulus package mean for restaurants, food workers and food producers passed by the Senate?
Tax Code Update for the Restaurant Industry
For about two years, retail industries and restaurants complained about apparent oversight in the 2017 Trump tax bill or the Tax Cuts and Jobs Act which prevented their claiming full tax credits for their property renovations that were undertaken during a single year, requiring instead that amounts be depreciated over 39 years! The amendment benefits totalling $15 billion to the retail/ restaurant industry.
Emergency Loans for Small Businesses
The stimulus authorizes $349 billion in relief for small businesses impacted by the coronavirus. Under stimulus provisions, the Small Business Administration can award $10,000 grants to financially suffering small businesses, including restaurant establishments and small food producers.
Employer Tax Benefits
Employers suffering financial losses but who are still paying employees during this difficult period, are certainly eligible for tax credit, albeit limited, when filing employee taxes. This helps many restaurants which are shut or providing takeout business or limited delivery, but are paying for a full roster of idle employees.
Small Business Loophole for Franchisees
Businesses with less than 500 employees but in multiple business locations, including restaurants and hotels, can benefit from the small business benefits available. This potential loophole allows franchisees of large corporations to avail of loans and other benefits intended for small businesses only.
Cattle Ranchers, Food and Vegetable Growers
The stimulus package provides $9.5 billion to an USDA Emergency Fund to render support to agricultural producers who were impacted by coronavirus, even covering those growing specialty crops like vegetables, fresh fruits, cattle ranchers, dairy producers and livestock producers.
Food Safety Inspections through USDA Funding
The bill provides $24 billion to the U.S. Department of Agriculture, including $14 billion to the agency for various coronavirus affected persons, to ensure that the agency has sufficient employees to maintain staff quarantine measures and ensure food safety inspections.
Unemployed Restaurant Workers
Recently unemployed restaurant workers estimated at 5 to 7 million workers will benefit from job losses as a result of coronavirus shutdowns as the stimulus package offers an additional weekly check of $600 for four weeks. This amount supplements the government checks for individuals authorized by the stimulus as also existing state unemployment benefits.
Supplemental Nutrition Assistance Program (SNAP)
The stimulus increased funding for food stamps (the Supplemental Nutrition Assistance Program) by $33 million and also enables easier access for seniors, individuals with disabilities, and children, who already receive SNAP, to secure their food and other related benefits.
Small and Independent Restaurateurs Feel Left Out?
Small business owners including many restaurateurs criticized the stimulus package for offering too many loopholes for franchise operations and large businesses that ultimately reduces funds relief available. They have a credible social media campaign targeted specifically to Speaker Nancy Pelosi, D-California, and other House Representatives, using the hashtag #sizematters.