In reality, Biden’s first 100 days are a declaration of war on small businesses. Biden’s $1.9 trillion spending bill passed last month is generating inflation. His numerous environmental orders, including canceling the Keystone XL pipeline and banning drilling on federal lands, are costing jobs and raising energy prices. And by revoking Trump administration deregulation and its business-led apprenticeship program, Biden is making it harder for small businesses to operate and find skilled workers.
But Biden’s biggest threats to small businesses so far have been his proposed tax increases and support for the Pro Act. Biden has proposed raising the corporate tax rate by 33 percent. Roughly one million American small businesses are structured as corporations and would be affected by this massive tax increase. Such small businesses include the likes of Ohio’s Alloy Precision Technologies, which employs about 85 people and has had to enact a hiring freeze to prepare for forthcoming taxes and regulations. Millions more small businesses who service corporations are also indirectly threatened by this tax hike.
Pass-through small businesses, which are subject to the individual tax code, will be impacted by Biden’s other tax proposals. Biden plans to implement a “success tax” (as JCN is calling it) by nearly doubling the capital gains rate and curtailing the so-called “step-up” basis tax treatment for the next generation. This success tax penalizes small business owners who have worked their whole lives to build the value of their businesses, forcing their children and grandchildren to sell their businesses in some cases just to afford the tax bill. Biden also wants to raise the top individual tax rate and reportedly curtail the 20 percent small business tax deduction that roughly 15 million small businesses rely on.