The impacts of the COVID-19 pandemic over the past year have been far-reaching – even into the world of tax credit programs.

Created in 1984, the Main Street Tax Credit Program provides a Business & Occupation or public utility tax credit to businesses for their private contributions to eligible downtown organizations. The goal of the program is to aid communities in revitalizing and restoring downtown and neighborhood districts. However, current state law stipulates that a tax credit must be used during the calendar year in which the contribution is approved.

Due to the impact of the COVID-19 pandemic, many businesses have an insufficient tax liability to use the full amount of their tax credit. HB 1297, sponsored by Rep. Alicia Rule (D-Bellingham), would allow businesses to carry their earned tax credit forward an additional two years. It would need to be used by December 31, 2023.

AWC supports the efforts of this bill as it would help sustain businesses through the COVID-19 pandemic in addition to increasing funding for local economic development.

HB 1297 received a public hearing in the House Finance Committee on Monday, February 1.