President Biden Lays Down New Tax Credits for Small Businesses

       On April 21th, 2021, President Biden announced new tax credits for businesses that have less than five hundred employees. The qualifier is that companies have to allow for up to eighty hours of paid leave or ten workdays of leave for their employees. Qualifying businesses are entitled to receive up to $511 in tax credits per day for each employee, which will be applied to owed taxes to the IRS. However, this tax credit can only be accounted for employees vaccinated between April 1st and September 30th, 2021. This program was included in the COVID-19 Relief Bill heavily pushed by Democrats, with almost no support from Republicans. 

       So, what’s the reasoning behind giving small businesses tax credits to have their employees vaccinated?

       Small businesses are usually heavily reliant on their employees. These businesses cannot afford to have their employees not come into work for extended periods of time. Since employees may experience temporary side-effects, they may require to take rest. Small businesses cannot afford to give paid leave for many days, especially with sales down due to the COVID-19 pandemic. Employees also cannot take a hit on their paycheck because most people are only getting by paycheck-to-paycheck. Biden said, “Every employee should get paid leave to get a shot, and businesses should know that they can provide it without a hit to their bottom line. There’s no excuse for not getting it done.”

       Biden’s new tax credits also serve to encourage employees to get vaccinated. They allow businesses to encourage employees to take the vaccine during a time of skepticism about COVID-19 vaccinations. This approach will allow for more workers in the United States to get vaccinated against COVID-19.

       However, while this program does encourage people to get vaccinated, it also directly translates into a lot of lost revenue for the United States’ government. This means that the Biden administration will have to figure out how they will make up for these losses. It is imperative that the United States government either reduce fiscal spending or find a way to make up lost tax revenue; otherwise, there could be a fiscal crisis for the American government in the months to come.