New York small businesses facing another huge expense amid coronavirus

New York businesses face another big expense amid coronavirus pandemic: Business leader

Business Council of New York State CEO Heather Briccetti discusses the burden of New York employers facing a tax hike while they are struggling during the coronavirus pandemic.

New York businesses are facing another "huge" expense amid the coronavirus pandemic, Business Council of New York State CEO Heather Briccetti said on Friday.

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The Empire State’s private employers are looking at a $9 billion tax hike which would impact state employers and businesses.

“So, basically, what it is, is when the state pays out unemployment, it comes out of a trust fund. That fund is paid for by employers based on payroll,” Briccetti told FOX Business' "Mornings with Maria."

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Earlier this year, the state was forced to borrow about $9 billion from the federal government. Employers are responsible for paying back that debt in form of a surcharge, she said.

“It hasn’t started yet but at some point, employers will have to pay back this debt. So, unfortunately, it’s a huge expense at a time when most businesses can’t afford it,” she said.

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The trust fund usually has "a couple of billion dollars a year" reserved to cover any unemployment claims, however, the state did not anticipate the "explosion" of job losses that occurred amid the coronavirus pandemic, she explained.

However, Briccetti said there are some things that businesses can do to “avoid” the expense.

One thing that could happen, she said, is Congress could forgive the debt “in part or in full.” While forgiving the debt could “directly benefit small business,” partial forgiveness would not aid recovery, she said.

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“Keep in mind those that repay this are businesses that are still open. So it could take a very long time [to repay it] if businesses close,” she explained.

Briccetti went on to say that 20 states are in the "same position that New York is" and "California has borrowed probably twice as much."

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