By Kalani Pa
Pa owns a franchise of Anytime Fitness gym in Lake Oswego. He lives in West Linn.
Recent Oregonian/OregonLive stories about a proposal to cancel state tax breaks included in the federal CARES Act focus on how these breaks benefit the “top 1%” in Oregon – Oregonians who earn more than $500,000 or businesses with revenue of more than $25 million. There never seems to be discussion about how companies like mine – small businesses that have experienced substantial pandemic-related losses in the last 11 months – also could benefit from the savings this proposal would take away.
My wife, Heidi, and I own an Anytime Fitness franchise gym in Lake Oswego. In a normal year, we earn a decent living. We are not rich, but we do well enough to support ourselves and provide a great service to the community.
There was nothing normal about 2020. Gov. Kate Brown instituted her first stay-home orders last March to limit COVID-19′s spread. Gyms and fitness centers closed and stayed that way, for most of the year.
We absolutely agree with the state’s focus on safety, but we also felt the very real financial impacts. Our revenue plummeted as we lost customers who understandably didn’t want to spend money on gym memberships they couldn’t use.
When Congress came together in a bipartisan way to pass the CARES Act, the business assistance provisions were designed to help struggling companies like mine. Congress recognized that the hardships we were facing were not of our own making; we shut down because the government told us to, to protect the public from COVID-19. Many of us have lost money; many others have lost their businesses entirely.
The CARES Act provided assistance to businesses that experienced a net operating loss by letting them use that to decrease their tax liability over a period of years. This provision was designed to help hard hit businesses keep some cash in their pockets as they struggled to stay on their feet.
It’s important to understand that you only get this tax saving if you lost money. It is not about helping rich people get richer. It’s about helping business keep their doors open and keep people working.
Unfortunately, some Oregon lawmakers don’t seem to get that.
Normally, Oregon automatically follows the federal tax code, so businesses taking advantage of this CARES Act provision would see savings on both their state and federal taxes. But in Salem, some legislators want to keep the state’s share of the savings. They seem more interested in propping up state spending than helping Oregon small businesses.
Unfortunately, the debate has focused almost exclusively on the impact to the “top 1%,” promoting the false argument that this will only affect the rich.
Well, I am not part of the 1%. And when I look around and see all the businesses that have suffered because of mandated closures and a crisis totally out of our control, I don’t see a bunch of rich people. I see people like me. People who own and run small businesses, play by the rules and work hard to make a living and fulfill their life dreams, like I did when I opened my own gym.
Will I take advantage of the CARES Act tax savings? I don’t know But, if it saves me money on my state and federal returns, after the year I had, I sure hope I get the opportunity.
So let’s add some truth to this conversation. Disconnecting from the CARES Act means turning our backs on potentially thousands of small businesses. Is that what our state really wants to do?