MBA, ‘Main Street Employers’ Urge Restraint on Tax Measures
Congress is currently wrestling with several large economic bills—including a massive $3.5 trillion Administration-backed infrastructure bill as well as numerous fiscal year 2022 budget proposals. How to pay for these measures remains hotly debated.
The Mortgage Bankers Association and a broad-based coalition of more than 100 organizations known as “Main Street Employers” want to make sure the burden of financing these bills does not fall on individual and family-owned businesses.
In a Sept. 9 letter to House Ways and Committee Chairman Richard Neal, D-Mass., Main Street Employers urged him to “reject any measures that would raise taxes on Main Street employers as part of the upcoming reconciliation bill.”
“Individually- and family-owned businesses are the cornerstone of the American economy,” the letter said. “They represent nearly all businesses, they employ the vast majority of private sector workers and they are the building block upon which innumerable communities across this country are built. The package of tax hikes being considered by the Biden administration and Congress represents a direct assault on these employers.”
The letter cited Administration proposals to raise rates on pass-throughs and C corporations; cap the Section 199A deduction; increase the capital gains tax; and impose capital gains at death would raise taxes on Main Street businesses when they operate, when they are sold and when they are passed on to the next generation.
“This triple threat would lock in unprecedented levels of government spending and taxes that would handicap these businesses and the communities that rely upon them, for decades to come,” the letter said. “They would also violate the President’s pledge not to raise taxes on individuals making less than $400,000 a year. Many individual and family business owners that make less than $400,000, including the 1.4 million private C corporation owners, family businesses with ownership shares held in trust, and entrepreneurs selling their business after a lifetime of work, will be directly harmed by these tax increases.”
The letter noted as inflation and unemployment remain stubbornly high, Main Streets across the country remain boarded up, their businesses closed and their workers idle. Estimates suggest up to one-third of all private businesses have closed their doors during the COVID-19 lockdowns, with more joining them every day.
“Congress should avoid tax policies that harm Main Street employers at any time, much less at this difficult moment in our nation’s history,” the letter said. “The Biden tax hikes pose a triple threat to the ability of these individually- and family-owned businesses to survive an uncertain future, and we urge Congress to reject them.”
