Article Summary –
Kamala Harris has proposed several economic policies to support small businesses, including expanding the tax deduction for startup costs from $5,000 to $50,000, creating a fund to help small banks cover loan interest, and simplifying tax filing processes. Harris also aims to modernize regulations to make federal funding more accessible and expand funding for the State Small Business Credit Initiative and Rural Partners Network. Additionally, her campaign promises to roll back Trump-era tax cuts for the wealthy and corporations, implement a billionaire minimum income tax, and increase the corporate tax rate to 28%, while ensuring that those earning under $400,000 do not see increased taxes.
Harris has proposed expanding a tax deduction for costs that are incurred while starting a business, creating a new fund that would allow the country’s smallest banks to cover the interest accrued on loans to new businesses, and more.
Kamala Harris on Wednesday unveiled several new economic policies aimed at supporting entrepreneurs and small business owners by reducing their expenses and increasing their access to capital.
Harris’ proposal involves expanding a tax deduction for costs that are incurred while starting a business to ease the financial burden on small business owners and incentivize more entrepreneurs to start businesses.
According to the Congressional Research Service, small businesses are currently granted a $5,000 deduction for expenses incurred during their first year of operation—Harris wants to raise that threshold to $50,000. This is much closer to the $40,000 the average small business owner puts into starting their business.
“As President, one of my highest priorities will be to strengthen America’s small businesses,” Harris said at an event in New Hampshire on Wednesday.
Harris also plans to simplify taxes for small business owners by implementing a standard deduction in the tax code that can save the smallest businesses time and money.
The vice president announced an initiative to modernize outdated regulations that hinder small businesses from applying for federal funding, urging state and local governments to follow suit.
Harris proposed a new fund allowing the country’s smallest banks to cover interest accrued on loans to new businesses.
“We intend to make it easier for people to actually do something that’s going to benefit our entire economy,” Harris said.
As vice president, Harris has promoted Community Development Financial Institutions (CDFIs), which provide capital to low-income communities and families.
Deputy Treasury Secretary Wally Adeyemo told CNN that CDFIs are important as they give new businesses with no financial histories a leg up.
The cost of capital is a major concern.
Harris plans to re-capitalize the State Small Business Credit Initiative (SSBCI), which focuses on rural America, middle America, and underserved communities.
She also emphasized funding the Rural Partners Network for job creation, infrastructure development, and community improvement.
If elected, Harris will expand contract opportunities for small businesses to provide goods and services to the federal government.
These proposals are part of Harris’ larger economic agenda focused on middle- and working-class voters.
“We know a strong middle class has always been critical to America’s success. And building that middle class will be a defining goal of my presidency,” Harris said in her speech at the Democratic National Convention (DNC) last month.
Harris aims to surpass President Biden’s 19 million new businesses created during his term, with a goal of 25 million new businesses in her first term.
Harris compared her economic policies to former president Donald Trump’s, arguing the tax revenue gained by rolling back provisions of Trump’s 2017 Tax Cuts and Jobs Act should be used for community investments.
Harris supports a billionaire minimum income tax, a corporate tax rate increase to 28%, and a higher tax on stock buybacks to ensure the wealthiest Americans pay their fair share.
“This approach strikes the right balance,” a statement from the Harris-Walz campaign reads, aiming to make the tax system fairer and raise revenue responsibly.
“Trump’s economic agenda would ignite inflation…trigger a recession by mid-2025, cost more than three million jobs, and add a percentage point to inflation,” the statement goes on. “We can’t go back to Trump’s failed approach.”
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