Yellowhammer Times

Alabama Daily News published a guest editorial by Rosemary Elebash, the State Director of the National Federation of Independent Business (NFIB), highlighting the need for Congress to make the 20% small business deduction permanent. Elebash emphasized that inflation is significantly impacting local businesses by increasing costs and forcing owners to raise prices. This situation, in turn, causes families to reduce spending, which negatively affects local businesses.

The Tax Cuts and Jobs Act, passed several years ago, included a provision allowing small businesses to deduct 20% of their business income from federal taxes. This deduction has been beneficial for communities in Alabama, aiding local businesses in their operations. However, this deduction is set to expire in 2025, which could lead to increased tax bills for most small businesses.

Elebash argues that without the deduction, small businesses will have less capital for essential expenses like equipment purchases and employee wages. This financial strain could force some businesses to close permanently. To prevent this outcome, Alabama's small businesses are urging Congress to pass the Main Street Tax Certainty Act. This bipartisan bill aims to make the 20% deduction permanent.

The NFIB Small Business Optimism Index rose slightly in June but remains below its long-term average for over two years. Inflation is cited as the primary concern among business owners. The initial inclusion of the 20% deduction in the 2017 tax bill was intended to help small businesses compete with larger corporations whose tax cuts were made permanent.

Passing the Main Street Tax Certainty Act would eliminate uncertainty from temporary extensions and provide stability needed by small business owners to expand and create jobs. Many members of Alabama's congressional delegation support this bill, including Senators Katie Britt and Tommy Tuberville and Representatives Jerry Carl, Barry Moore, Gary Palmer, Mike Rogers, and Dale Strong.

The proposed legislation promises immediate relief for Alabama’s job creators by facilitating business growth and community contributions. Elebash concludes that supporting small businesses ultimately benefits everyone due to their crucial role in Alabama’s economy.