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Small businesses are the strength of our economy, innovation, and job creation. They are at the center of our communities and employ 60% of our nation’s workforce.
Recently, in an effort to hear directly from entrepreneurs, I hosted a Small Business Roundtable at the Yuengling Brewery Conference Center in Pottsville. During the event, more than 40+ small business owners shared their concerns. The common theme was that they believe that the Biden Administration is advancing policies that make doing business more challenging. Rising inflation, soaring energy costs, and supply chain issues, in addition to ill-conceived rules, regulations, and taxes are standing in the way of their success.
As someone who spent 20+ years in the private sector helping grow a small business into a large business, I have a deep appreciation for these challenges. That’s why I sit on the Small Business Committee and Financial Services Committee in Congress, which serve as a line of defense for small businesses and the financial system they rely on to access capital to start and grow their businesses.
House Republicans have and will continue fighting for Small Businesses, which is why we passed H.R. 1, the Lower Energy Costs Act, and H.R. 277, the REINS Act, which prohibits the Executive Branch from spending without Congressional approval. Both bills will help lower expenses for small businesses.
But the fight continues, and currently, of particular concern, is the Biden Administration and Congressional Democrats’ unwillingness to work with Republicans to extend successful provisions of the Trump Tax Cuts and Jobs Act, such as the R&D Tax Credit, full Bonus Depreciation, and the Small Business Deduction.
If Democrats allow these provisions to sunset, small businesses will see significant tax hikes that would hurt their business, their employees, and ultimately, consumers.
Without the R&D Tax Credit, innovation would be stifled, which has always been an economic driver in the United States. For that reason, I have continued to advocate for the American Innovation and R&D Competitiveness Act, which would permanently restore full and immediate R&D expensing for small businesses and incentivizes long-term investments in technological breakthroughs.
I’ve also continued to call for the passage of the ALIGN Act to make permanent one of the most pro-growth policies in the Tax Cuts and Jobs Act, full and immediate expensing, by continuing Bonus Depreciation. Full expensing allows businesses to deduct the cost of new investments (machinery, equipment, etc.) in the year they are purchased, instead of being depreciated under complex IRS rules. Under current law, Bonus Depreciation is set to decrease 20% annually through 2027, hindering entrepreneurs’ ability to invest in their businesses.
And lastly to be noted here, but certainly not all, is the Main Street Tax Certainty Act, which allows small businesses to deduct up to 20% of qualifying income. This deduction is, unfortunately, slated to expire at the end of 2025. But making the “Small Business Deduction” permanent would give entrepreneurs much-needed predictability and help keep the doors open, employees on payroll, and prices at a reasonable level.
It really is perplexing that the Biden Administration and Congressional Democrats are standing in the way of these commonsense pro-growth policies. In fact, instead of supporting initiatives that help small businesses, they’re taking actions that directly hurt them. The Consumer Financial Protection Bureau recently implemented a rule that would saddle community lenders with additional and significant compliance costs. The Federal Reserve just released a proposal that would raise capital requirements on banks, and in turn, force them to increase borrowing costs and reduce credit access. These are of course on top of countless ESG standards being forced on American industry and the manifested inflation stemming from the Democrats’ excessive spending and assault on domestic energy production.
House Republicans remain committed to our small business community. So as the 118th Congress progresses, we remain steadfast in our goal to implement competitive tax rates, cut regulations, block onerous rules, lower the cost of energy, stimulate the workforce, promote favorable trade deals, end excessive spending, and make America the most competitive country in which to do business.
As Ronald Reagan said, “a strong American economy is essential to the well-being and security of our friends and allies.”
Dan Meuser serves as U.S. Representative for Pennsylvania’s 9th Congressional District. He is a member of the Small Business Committee and chairman of the Subcommittee on Economic Growth, Tax, and Capital Access.