Small businesses struggle to meet sales tax deadline

The governor emphasizes it's the state's money.

March 20, 2020 6:31 pm

PROVIDENCE, R.I. (WLNE) — Lunchtime is usually prime time at Ocean State Sandwich Company, with lines to the door.

Today, it’s a different story.

“We’re dealing with a 60 to 75 percent loss of business,” said owner Eric Handwerger.

He says he understands why the state still wants the sales tax money he collected on its behalf.

But Handwerger anticipates it could mean more sacrifices in terms of laying off employees.

“Any relief we can get right now is important,” he said. “You’re going to see a lot of places have to close temporarily, or some places might have to close permanently.”

With mounting concerns about state revenue, Governor Raimondo did not agree to change Friday’s sales tax deadline, instead suggesting small businesses turn to loans as a solution.

“There will now be loans available for all of Rhode Island’s small businesses, up to $2 million,” she said.

But restaurant owners are still concerned.

“We’d love to see some flexibility and some options, other than supposed low–interest rate loans,” Handwerger said. “Three–point–seven–five percent is not exactly the best interest rate, when we’re struggling to bring in every penny we can.”

Some customers say restaurants shouldn’t be forced to take steps like laying off staff in order to meet sales tax requirements.

“They can kind of waive these things to give these people a fighting chance to get through this,” said Bryan Pickell of Providence. “There’s plenty of time to make it up on the back end, but people need help right now.”

Raimondo emphasizes sales taxes are the state’s money. But Handwerger says even if she isn’t willing to change the deadline, he’d like to see her at least eliminate late fees.