SB 49 Would Provide COVID Relief for Business License Fees

As amended February 1, Senate Bill 49 by Senator Tom Umberg (D-Santa Ana) would provide an exemption from license fees imposed on businesses. It would add Sections 16000.9 and 16100.9 to the Business and Professions Code, add Section 8627.9 to the Government Code, and add and repeal Sections 17053.70 and 23670 of the Revenue and Taxation Code.

Section One of the bill would add Section 16000.9 to the Business and Professions Code. It would define “COVID-19 state of emergency” and “COVID-19 stay-at-home order.” It would also define an “eligible business” as any business subject to licensure that is a restaurant, bar, or entity licensed by the Board of Barbering and Cosmetology, as well as a business that has temporarily ceased operations in response to a COVID-19 stay-at-home order.

Under this new provision of law, a city would be prohibited from collecting any regulatory license fee imposed upon an “eligible business.” The business would have to certify that it has complied with all applicable COVID-19 stay-at-home orders.

Section Two of the bill would add Section 16100.9 to the Business and Professions Code. It contains the same language as Section One of the bill, but applies to counties their regulatory license fees that are imposed upon eligible businesses.

Section Three of the bill would add Section 8627.9 to the Government Code. It contains the same language as Sections One and Two of the bill, but applies to state agencies and their regulatory license fees that are imposed upon eligible businesses.

Section Four of the bill would add Section 17053.70 to the Revenue and Taxation Code. This section applies to individuals under the Personal Income Tax Law. It would provide for a one-year (for calendar year 2022) a tax credit equal to the amount paid or incurred in eligible costs by a qualified taxpayer before January 1, 2022. It would use the same definitions from the prior sections of the bill and defined “eligible costs” to include any amount paid to a state agency or a local government in connection with a permit, license, or other mandatory operating cost imposed by the state or a local government. “Qualified taxpayers” would be the same as “eligible businesses”.

Section Five of the bill would add Section 23670 to the Revenue and Taxation Code with the same language as contained in Section Four of the bill. This section applies to businesses under the Bank and Corporation Tax Law.

The bill is expected to be heard in the Senate policy committee in early March.