Congress must pump the brakes on proposal to increase taxes on small business investment

In the wake of a devastating pandemic and the resulting economic consequences, the US incurred considerable debt in order to “rebuild better,” as President Joe Biden likes to say.

On the positive side, the federal programs funded through this debt have helped millions of small businesses stay open and have allowed many more Americans to continue receiving paychecks. But as Congress is now trying to spend even more to improve our country’s crumbling infrastructure and strengthen our “social infrastructure,” it has to ask itself how to pay for it all.

One idea should be removed from the list of options. HR 1068 and p. 1598 are extreme proposals aimed at “watering the rich” by increasing taxes on small business investments. Some members of Congress want to include such laws in the US $ 3.5 trillion family plan. Just it won’t water the rich – it will end up hurting the very small businesses that are most in need of help. I hope you will join me in opposing these efforts.

This Small Business Investment Tax would have a deterrent effect on new private investments in small employers. About 14,000 small businesses depend on the private investments that would be subject to this tax hike; Investments that will save nearly 12 million American jobs and add $ 1.4 trillion to the US economy.

We’re not talking about large conglomerates here. Rather, these are the types of businesses that enrich our communities and grow our economies. 86% of companies that benefit from this type of private investment employ 500 people or less. A third of them employ 10 or fewer.

A wide variety of industries will feel the effects of such a tax; Real estate, hotels, restaurants, manufacturing, and other basic job advertisers need the investment capital that is in the crosshairs of Congress.

It is no surprise that the many large business organizations and their members are raising their concerns. The following is just one example of the groups who view this suggestion as a serious concern:

• United States Chamber of Commerce
• American Hotel and Accommodation Association
• American Resort Development Association
• American Housing Association for Seniors
• Asian-American Hotel Owners Association
• Building Owners and Managers Association (BOMA) International CCIM Institute
• Institute for Real Estate Management
• International Council of Shopping Centers
• Association of Mortgage Lenders

The stated goal of the American Rescue Plan and the American Family Plan is to rebuild our economy stronger than ever. Tax hikes that penalize investments in small businesses run counter to this idea. Therefore, Maine Congressmen must oppose this legislation in its current form.