President Trump’s Tax Proposal Would Hurt Small Businesses
Statement from John Arensmeyer, Small Business Majority Founder & CEO, on why today’s White House tax proposal would be bad for small firms
President Trump’s tax proposal released today would hurt small businesses because it would drastically increase the deficit by lowering the corporate rate to 15 percent without getting rid of corporate tax loopholes. Small businesses are not asking for a lower tax rate in a vacuum, nor are they asking for tax cuts that are going to grow the deficit. Instead, they want tax reform that will level the playing field so that they are not stuck footing the bill when large corporations take advantage of loopholes and avoid paying their fair share. Today’s proposal makes no attempt to close any of the loopholes large firms exploit, therefore it does nothing to put all of America’s businesses on more even footing.
Additionally, the repatriation proposal fails to address the substantial tax advantage given to big businesses because it would not do away with the loophole that allows multi-national corporations to defer paying taxes on foreign profits. This loophole costs the U.S. Treasury Department more than $1 trillion over 10 years, and only serves to benefit a select number of multi-nationals at the expense of small businesses. In fact, Small Business Majority’s scientific polling found more than 9 in 10 small business owners think this loophole is a problem, and three-quarters say their small business is harmed when loopholes allow big corporations to avoid taxes.
This proposal also seems to perpetuate the myth that ending the estate tax will help small business owners. In reality the estate tax, which only applies to estates valued above $11 million for married couples, impacts almost none of our nation’s 28 million small businesses.
It is irresponsible to suggest drastically cutting corporate rates without offering any indication of how that lost revenue would be offset. We urge lawmakers to reject President Trump’s plan as a framework for future discussions on tax reform, and instead hope that they take the needs of small businesses into account when overhauling our nation’s tax code.
About Small Business Majority
Small Business Majority was founded and is run by small business owners to focus on solving the biggest problems facing small businesses today. Since 2005, we have actively engaged small business owners and policymakers in support of public policy solutions, and have delivered information and resources to entrepreneurs that promote small business growth and drive a strong economy. We regularly engage our network of 55,000 small business owners along with a formal strategic partnership program of more than 150 business organizations, enabling us to reach more than 500,000 entrepreneurs. Our extensive scientific polling, focus groups and economic research help us educate and inform policymakers, the media and other stakeholders about key issues impacting small businesses and freelancers, including access to capital, taxes, healthcare, retirement, entrepreneurship and workforce development. Learn more about us on our website and follow us on Twitter, Facebook and Instagram.