VP @KamalaHarris has a plan to grow our economy and support the middle class.
This will help ensure our small businesses continue to have the resources they need to grow and thrive.https://t.co/6ai0l1vKIq
— Deborah Ross (@DeborahRossNC) September 9, 2024
Vice President Kamala Harris has announced plans to help small businesses in the U.S. Her proposals include reducing government bureaucracy, creating a standard deduction for small businesses, and making it easier for businesses to obtain occupational licenses across state lines. Harris also plans to suggest new steps for increasing investments in rural businesses through an expansion fund and mandate that a third of federal contract dollars go to small businesses. However, her proposals lack details, making it difficult to assess their impact and cost.
Harris has been specific about one idea: increasing the small business startup tax deduction from $5,000 to $50,000.
VP Kamala Harris does an interview with Ms Jessica from Power 98: https://t.co/Kpoz7c9kEg
— Joe Bruno (@JoeBrunoWSOC9) September 7, 2024
This change would allow more startup expenses to be written off and defer the deduction to years when profits are generated. Despite this, Harris’s focus seems to be on the wrong set of small businesses.
If the personal income tax credits are allowed to expire, American will see their federal income taxes rise by an average of $1,100. Additionally, an estimated 2 million full-time jobs would be destroyed. I’ll keep pushing to extend these tax credits. https://t.co/gJoLfbnaGp
— Gus Bilirakis (@RepGusBilirakis) September 9, 2024
The Biden administration recently announced a surge in new startups, with the U.S. averaging 430,000 new business applications per month in 2024, a 50% increase from 2019. Startups appear to be flourishing without additional incentives. The small businesses that genuinely need support are the more established, employer-owned companies.
These businesses employ 61.7 million Americans, representing 46.4% of private sector employees. These companies are struggling to grow and their optimism is low. Here are four ways to help these businesses:
Kamala Harris’s plan to hike capital gains taxes by nearly 40% is a brutal attack on entrepreneurs and small businesses. Masking it as “moderate” is a sham—she’s crippling the very innovators she claims to support.https://t.co/mXKicFUceh
— Glenn Hegar (@Glenn_Hegar) September 8, 2024
1.
Harris’s small business support plans
Extend the Qualified Business Income Tax Deduction: Part of the 2017 Tax Cuts and Jobs Act, this deduction allows most “pass-through” companies to deduct 20% of their costs before their income passes through to individual returns. Extending or making this deduction permanent would significantly benefit established small businesses.
2. Regulations: Under the Biden administration, new regulations have increased operating costs for small businesses. Exempting the smallest companies (those with fewer than 10 workers) from many of these rules would reduce their costs and administrative burden.
3. Rural Investments and Government Contracts: Existing programs designed to help businesses secure government contracts are underutilized. Increased funding for advertising and public relations campaigns could raise awareness and utilization of these resources.
4. Address the ‘Silver Tsunami’: An estimated $80 trillion transfer of wealth will occur in the U.S. over the next two decades as baby boomer business owners retire. Encouraging the creation of employee stock ownership plans (Esops) could help employees purchase equity in their companies, ensuring business continuity and protecting retirement savings.
The U.S. startup environment is already strong, but the focus should be on supporting existing small business owners who are vital to the economy.
