The COVID-19 pandemic has wreaked havoc on the United States, not just in terms of lives lost, but also in terms of the country’s ability to maintain a fully operational economy.
The latest developments surrounding the COVID-19 Omicron variant have American businesses on edge, and for good reason. The World Health Organization (WHO) has stated that the new variant poses a “very high” global risk, leaving companies around the world once again anticipating even more government restrictions.
Recovering from the devastating impact of COVID will prove to be a long journey for the restaurant industry. Recent data shows that sales are $240 billion below normal, 8 million employees have been laid off or furloughed, and over 110,000 eateries closed for good in 2020, and it’s evident the way back to pre-crisis level of sales and employment will not be straightforward.
Last December Congress released the Consolidated Appropriations Act of 2021 which provided major tax breaks for companies that have found ways to come together with their teams to embody America’s commitment to innovation in the midst of the pandemic.
The revamp of the employee retention credit under the Consolidated Appropriations Act, 2021 (CAA, P.L. 116-260), has turned an underused relief option into the most potentially powerful credit available to struggling businesses.
Restaurant owners have had to completely flip their operations to accommodate proper health and safety protocols for over a year now, but the country is finally starting to see the light at the end of the tunnel with an influx of vaccine distribution.
The Employee Retention Credit (ERC) is a tax credit first put in place last year as a temporary coronavirus-relief provision to assist businesses in keeping employees on payroll.
Congress is to be commended for moving swiftly this spring to mitigate economic fallout from COVID-19, but the pandemic has exposed core vulnerabilities for the United States that require more than patchwork solutions. Now is the time to improve tools in the tax code that will make American businesses more competitive while increasing their ability to withstand the inevitable future economic shocks. We should start with the R&D tax credit. Let’s make it more generous, especially for U.S.-based manufacturers and small and mid-size businesses.
Every business is adapting to a rapidly changing world. Water treatment companies, like many small and medium sized businesses right now, are looking for funding for the future so they can retain their employees, hire more technical talent and better serve their clients.
The U.S. is facing a path diverged. During the third month of the COVID-19 pandemic, Americans are rightfully wondering not only how long this health and economic crisis will last, but what the other side of this tragedy will look like.