A roughly $2 trillion economic measure designed to protect the coronavirus-slammed economy appears to be on its way to congressional approval.
Following its passage in the Senate, the legislation — set to become the largest fiscal stimulus package in modern U.S. history — is expected to get the green light in the House. It would not only send direct payments and grant unemployment benefits to millions of Americans, but also provide financial aid to states and businesses that have suffered amid the pandemic.
Here, FN breaks down the bill for retailers and consumers, as well as shares top industry leaders’ reactions — and what additional steps need to be taken for the footwear and fashion industries to survive these challenging times.
Small businesses: The measure will provide $349 billion for the Small Business Administration to guarantee loans to companies and nonprofits with fewer than 500 employees, with some exceptions. Applicants will be able to apply for loans up to $10 million — up from $5 million prior to the legislation — with a maximum interest rate of 4%. Borrowers are given the option of deferring payments for six months to a year.
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General businesses: The Treasury Department will offer $500 billion for loans, loan guarantees or other assistance to businesses, states and municipalities, including $29 billion for passenger and cargo airlines as well as $17 billion for businesses that are critical to national security. Hospitals and veterans’ care will get $117 billion and public transit will take $25 billion — both part of a $340 billion package for supplemental spending. About $150 billion will serve as direct aid to states, distributed by population size, and $221 billion will be offered in a variety of tax benefits for businesses.
Checks: Every eligible American will receive a direct payment of $1,200, while married couples get $2,400 and parents take home an additional $500 for each child under the age of 17. These payments will be phased out for individuals whose adjusted gross incomes total more than $75,000, while people who make more than $99,000 do not qualify. According to the Tax Policy Center, roughly 90% of households will benefit from the stimulus checks.
Unemployment: The jobless will be given weekly pay of $600 for four months on top of state benefits, which averaged about $372 a week at the end of February, reported the Labor Department. What’s more, the bill pledges up to 13 weeks of extended benefits, covered by the federal government. (Across most states, laid-off workers receive a maximum of 26 weeks of benefits.) It will also provide benefits to self-employed and gig workers, who typically aren’t eligible for such assistance.
Student loans: The Department of Education will suspend student loan payments without penalties until Sept. 30.
American Apparel and Footwear Association president and CEO Steve Lamar:
“This legislation will inject liquidity into the system, allowing companies to sustain operations and keep employees on the payroll so they start up quickly once health authorities give us the all-clear. At the same time, the industry needs immediate action on tariff relief. Over the past 18 months, the U.S. has collected approximately $50 billion in punitive tariffs on textiles, apparel, footwear, travel goods and many other inputs and finished items. These funds can quickly be released — using existing mechanisms and without further congressional authorization — to companies who need them to survive.”
Footwear Distributors and Retailers of America president and CEO Matt Priest:
“It’s a step in the right direction, Congress passing massive stimulus in support of the American people. What’s missing is an immediate delay of duty payments up to 90 days that the Trump administration can implement now. Why they refuse to do so is beyond me, but we’ll keep pushing the administration to do the right thing and stop taxing American businesses during this crisis… Beyond that, we hope that landlords will provide some flexibility in lease payments to help ease the pressure and provide some much-needed liquidity for our companies.”
This Is What Small Retailers Want From the $2 Trillion Stimulus Package
What Fashion and Footwear Firms Are Looking for in the $2 Trillion Coronavirus Stimulus Bill