WASHINGTON: The United States will give individuals, and small and mid-sized businesses a three-month tax holiday to try to fight the economic impact of the novel coronavirus, President Donald Trump (pix) said Wednesday night.
It will also give affected companies $ 50 billion more in low-interest loans, he said.
The moves, designed to keep markets liquid and businesses and consumers spending, were overshadowed by Trump’s announcement that the U.S. would suspend travel from Europe for 30 days, and confusion over whether he had said cargo would be banned as well.
Trump said he would instruct the Small Business Administration (SBA), a government agency, “to exercise available authority to provide capital and liquidity to firms affected by the coronavirus.”
Effective immediately, he said, the agency would provide low-interest loans to companies in affected areas.
He said he would ask Congress to increase funding for the SBA lending program to $ 50 billion. That would be more than double the amount of loans the SBA’s flagship lending program made in fiscal year 2019.
He also said that some people and businesses would be able to defer paying their federal income taxes, normally due April 15, for three months, with no penalties.
“Using emergency authority, I will be instructing the Treasury Department to defer tax payments without interest or penalties for certain individuals and businesses negatively impacted,“ he said.
The pledge echoes testimony from Treasury Secretary Steven Mnuchin to Congress today. Deferring taxes could put another $ 200 billion into the U.S. economy, both Trump and Mnuchin said, but didn’t elaborate on how that was calculated. -Reuters