SBE Council Statement on VP Harris’s Startup Tax Deduction and Small Business Proposals

By SBE Council at 4 September, 2024, 3:36 pm

NEWS

FOR IMMEDIATE RELEASE

Washington, D.C. - In response to the small business proposal announced by Vice President Kamala Harris today, Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan issued the following statement:

"While the proposed increase in the startup deduction is a welcome policy proposal, unfortunately a range of other policies being pushed by Vice President Harris work against small business survival and growth, and the countless individuals who wish to pursue their entrepreneurial dreams.

"For example, the PRO Act along with the Administration's new independent contractor rule will eliminate self-employment opportunities and threatens the livelihood and flexible business ownership that millions of independent contractors currently enjoy. Moreover, allowing the expiration of the 20% small business deduction and other business and individual tax measures provided by the Tax Cuts and Jobs Act puts Main Street businesses at great risk as they will have less capital to compete, innovate and grow. Increasing the corporate tax rate, as Vice President Harris supports, would disproportionately hit small businesses, as the bulk of C-corps are small firms. And increasing the capital gains tax, as highlighted by the Vice President today, actually harms capital formation and its availability. The startup ecosystem and small business growth would be damaged and U.S. competitiveness would certainly suffer.

"Indeed, while new business applications have hit record levels over the past 4 years, only a small percentage of these applications actually convert to the launch of a new business. Therefore, maintaining a positive, enabling business environment - one that includes tax certainty and investment incentives that businesses can count on to stabilize and grow - is fundamental to successful startup activity and encouraging more of the 25 million applications that the Vice President set as her goal to actually launch into new businesses.

"In addition, we are glad to see the Vice President's general support of lowering costly regulatory. However, the record level of federal regulation aimed at small businesses over the past three years does not model the regulatory balance that the Vice President hopes Governors and state legislatures will initiate. If Vice President Harris is calling on states to remove costly barriers, the federal government should immediately do the same.

"As Vice President Harris visits small businesses during her campaign stops, we encourage her to discuss these important issues with entrepreneurs so she can better understand how federal tax and regulatory policy affect their competitiveness and survival, as well as the incentives that are needed to not only start a business but to successfully grow one."

CONTACT:

KAREN KERRIGAN, [email protected]

RAYMOND KEATING, [email protected]

SBE Council is a nonpartisan advocacy, research and education organization dedicated to protecting small business and promoting entrepreneurship. For nearly 30 years, SBE Council has worked on and advanced a range of private sector and public policy initiatives to strengthen the ecosystem for strong startup activity and small business growth.

Visit www.sbecouncil.org for additional information. Twitter: @SBECouncil

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