I started a business in 2016 and the last time I filed taxes with it is 2020 and then put it on hold, would it be considered starting a new business if I file this year?

If you have continued to file Schedule C with your personal tax return each year and/or never reported that the business ended, you don't need to start a new business. Instead, you can simply update the information and use the prior ending inventory as your beginning inventory this year.

I haven't filed a Schedule C with this particular business since 2020 since I wasn't working that business and put the business on hold. When it asks about previous inventory for 2023 I can just put the inventory number at the end of the last year I filed?

It depends.  If you had no remaining inventory and you didn't have an ending inventory on your 2020 return there is nothing to enter. If you did have an ending inventory you can use that as inventory or materials and supplies if you choose the cash method of accounting. The following details are have been in effect since 2018 and will continue through 2025. At that time, it could be extended indefinitely.

Under the Tax Cuts and Jobs Act (TCJA):

According to TCJA, businesses with gross receipts below $26 million are considered eligible to use the cash method of accounting for their inventory.  

• TCJA Comparison for Businesses: The law expands the number of small business taxpayers eligible to use the cash method of accounting and exempts these small businesses from certain accounting rules for inventories, cost capitalization and long-term contracts. As a result, more small business taxpayers can change to cash method accounting starting after Dec. 31, 2017. 

@jfourn37