California Gov. Gavin Newsom on Thursday signed an executive order providing a 60-day tax-filing extension for individual and business due to the new coronavirus outbreak. (AP)
Newsom included the extensions in an executive order starting a variety of public health and economic relief actions, even as cities in California took more limited approaches. San Francisco Mayor London Breed said the city would defer the April 30 due date for first-quarter business taxes to February 2021 for the approximately 8,050 businesses with up to $10 million in gross receipts, in addition to deferring licensing fees for three months.
Breed spokeswoman Mandy Ngu referred questions on possible individual tax relief efforts to President Donald Trump's call earlier in the week for Congress to provide an unspecified payroll tax cut for the American public, a plan Democratic House leaders said was off the table.
In Washington, D.C., the chairman of the district council unveiled legislation to stall sales tax filings and remittance, and New York City Mayor Bill de Blasio said at a press conference that he was looking to extend the March 15 filing deadline for small businesses.
Measures to support businesses and others via federal, state and local tax codes have been amping up this week amid intensifying fears of COVID-19's potential effects on people, business and the overall economy. Those fears only worsened Wednesday when the World Health Organization declared coronavirus a pandemic.
In Maryland, Comptroller Peter Franchot said he would extend business-related filing deadlines in March, April and May to June 1, including for sales and use tax, withholding tax and a variety of excise taxes and fees. Franchot said the state would wait to adopt any corporate or income tax extensions provided for federal tax returns.
"This extension will provide much-needed relief to our business owners as they adjust to changes in consumer behavior, tourism trends and employee workforce output," Franchot said in a statement.
Susan O'Brien, director of communications for the comptroller, said the state's corporate and individual filing deadlines conformed to federal deadlines, so announcing an extension shortly before a federal extension could create confusion.
"To minimize the amount of confusion, we are waiting for the federal extension of deadlines," O'Brien said in a phone call following the Republican Gov. Larry Hogan's announcement upgrading the state's emergency status. "If this is prolonged longer than we expect, we will address these things as they come along."
The Maryland comptroller's office would likely announce its own corporate and individual income tax extension in the next week if the Internal Revenue Service did not act soon, O'Brien said. The new June 1 deadline may also be extended in the future, she added.
Other localities have been slower to provide tax relief to businesses and individuals affected by the growing impact of the coronavirus. Taking questions from reporters Wednesday, de Blasio said his administration would look into providing the extension for certain businesses.
"We'll look at that," de Blasio said. "I have to get clear about how, what we do interrelates with the state, but we'll certainly going to see if there's a way to provide some relief there."
Marcy Miranda, a spokeswoman for the New York City Department of Finance, told Law360 said that the city had a few small business deadlines under its control but had not come to a decision as of Thursday.
"The Department of Finance is still reviewing the issue of extending income tax deadlines for small businesses," Miranda said in an email.
D.C. Council Chairman Phil Mendelson proposed a coronavirus legislative package Thursday that included a proposal allowing businesses to file sales tax returns and remittance up to 90 days late without penalty. However, the measures would not be considered until the council meets Tuesday.
The city's chief financial officer can already delay individual and business taxes, Mendelson's legislative director, Evan Cash, told Law360. A spokesperson for the CFO referred questions to Mayor Muriel Bowser and the council.
Tax relief efforts began earlier in the week when Washington state announced that it would waive financial penalties for employers that file late tax reports, pay taxes late or don't respond to information in a timely fashion because of COVID-19. Seattle also said it would defer business and occupation tax filings.
Spokespeople for Newsom, de Blasio and Bowser did not immediately respond to requests for comment.
--Additional reporting by Stephen Cooper, James Nani, Daniel Tay, Alan K. Ota, Alex M. Parker and Joshua Rosenberg. Editing by Neil Cohen.
For a reprint of this article, please contact reprints@law360.com.