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2020 Special Session I

Budget Amendments - HB5005 (Member Request)

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Chief Patron: Carroll Foy
Tax Credit for PPE Purchased by Small Business and Other Organizations (language only)

Item 4-14 #1h

Item 4-14 #1h

Effective Date
Effective Date

Language

Page 242, after line 6 insert:

"9. a. For the purposes of this section: "Eligible taxpayer" means (i) any small business; (ii) any business enterprise that is engaged in agricultural production for market, ranching, raising of livestock, or aquaculture; (iii) a nonprofit organization described in 26 U.S.C § 501(c)(3); (iv) a veterans organization; or (v) an individual who operates under a sole proprietorship, as an independent contractor, or as a self-employed individual.

b. Qualified personal protective equipment expense" means amounts paid or incurred by an eligible taxpayer (a) for the sole purpose of reducing the risk of transmission of the virus responsible for COVID-19 between people on the premises of the business of the eligible taxpayer, including (1) gloves, medical masks, N-95 respirators, eye protection, gowns, aprons, boots or closed-toe work shoes, cleaning detergents, hand sanitizers, and cleaning products; (2) installation of equipment; and (3) any other relevant expense determined necessary by the Virginia Department of Health, and (b) at any time during a year in which, with respect to the COVID-19 pandemic, the Governor declares a state of emergency.

c. Small business" means a business entity operating in the Commonwealth and certified by the Department of Small Business and Supplier Diversity as a small, women-owned, or minority-owned business pursuant to the conditions and provisions in § 2.2-1604.

d. For taxable years beginning on and after January 1, 2020, an eligible taxpayer shall be allowed a refundable credit against the tax imposed pursuant to § 58.1-320 or 58.1-400 in an amount equal to the amount paid or incurred by such eligible taxpayer for qualified personal protective equipment expense during such taxable year.

e. Credits granted to a partnership, limited liability company, or electing small business corporation (S corporation) shall be allocated to the individual partners, members, or shareholders, respectively, in proportion to their ownership or interest in such business entities.

f. The Department of Taxation, in consultation with the Department of Agriculture and Consumer Services and the Department of Conservation and Recreation, shall develop guidelines for claiming the credit provided by this section. Such guidelines shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000 et seq.)."

Page 242, line 7, after "seventh" strike "and".

Page 242, line 7, after "eighth" insert "and ninth".



Explanation

(This amendment creates a tax credit for the purchase of personal protective equipment (PPE) by small businesses, 501(c)(3) non-profits, veterans’ organizations, independent contractors, farmers, sole proprietors, and other organizations as defined by the Administration.)