House Republican introduces bill to provide tax credit to businesses for PPE

Rep. Tom Rice (R-S.C.) introduced legislation on Thursday that would provide a tax credit for businesses to safely reopen and pay for extra safety measures amid the coronavirus pandemic.

The Healthy Workplaces Tax Credit would provide a refundable tax credit against payroll taxes for 50 percent of the costs incurred by a business for COVID-19 testing, personal protective equipment (PPE), disinfecting, extra cleaning and reconfiguring work spaces to adhere to social distancing guidelines. 

The credit is limited to $1,000 per employee for a business’s first 500 employees, $750 per employee for the next 500 employees and $500 for each employee after that. For example, if a restaurant with 40 employees spends $60,000 on PPE, testing, disinfecting and plexiglass shields, it would receive a $30,000 tax credit against its payroll.

The legislation is intended to encourage and enable businesses to take the recommended steps to prevent the spread of COVID-19 in their workplaces. Rice, who is on the House Ways and Means Committee, introduced the bill as an addition to legislation from Rep. Darin LaHood (R-Ill.) that would create a temporary tax credit to offset costs of cleaning. 

“It’s important we reconnect workers to jobs and prevent more business closures. Our healthy workplace tax credit will support businesses as they reopen by incentivizing them to take extra precautions to protect the health of patrons and employees,” Rice said in a statement Thursday.

Business groups have called for a tax credit, with the National Restaurant Association urging Congress to provide a tax credit for wellness investments like enhanced sanitization, contactless payment services, employee training, PPE and disposable products.

Retail groups applauded the legislation.

David French, senior vice president for government relations at the National Retail Federation, said in a statement that the tax credit addresses “the costs of reconfiguring stores and restaurants to provide more social distancing, and ongoing costs for protective gear and cleaning.”

The Retail Industry Leaders Association (RILA) said the bill would help businesses of all sizes offset the cost of preventing the spread of COVID-19.

“The Healthy Workplace Tax Credit enables businesses of all sizes to continually make the necessary investments that give workers the confidence to return to work and consumers the reassurance that shopping can be done in a safe manner. Providing employers with this tax credit will help get our economy back on track,” Dave Koenig, RILA vice president of tax, said in a statement.

The Occupational Safety and Health Administration (OSHA) has declined to impose a nationwide COVID-19 work safety standard and has only issued recommendations. Virginia on Wednesday became the first state to adopt statewide emergency workplace safety standards to deal with the coronavirus.

Updated at 3:33 p.m.