To pay for all the much needed and long overdue infrastructure improvements outlined in the American Jobs Plan, President Joe Biden has proposed raising the corporate tax rate to 28 percent.
If you’re standing anywhere near the anti-tax echo chamber, you might think he was proposing raising the corporate rate above the 1968 all-time high of 52.8 percent — or even back to the 35 percent rate in effect prior to the 2017 passage of the Tax Cuts and Jobs Act. And that this is a dire threat to small business.
But if you step outside the echo chamber, you’ll hear the majority of small businesses — and the majority of Americans — showing their support for the American Jobs Plan and for having corporations to fund it. And you would wonder why their voices — again, the majority view — aren’t reverberating as loudly as those whose priority seems to be protecting corporate loopholes.
The data on this are clear. In April, a Morning Consult poll found 65 percent of voters support the plan. Now, we see that sentiment mirrored in a new national survey of small business owners conducted by Small Business for America’s Future. In the survey, 80 percent of small business owners support the American Jobs Plan and 67 percent of respondents support increasing taxes on large corporations to pay for it.
As has often been ruefully pointed out lately, getting a majority of Americans to agree about anything these days is difficult. You would think this kind of strong consensus among voters and business leaders would indicate a clear path forward. Yet, elected opponents of raising corporate taxes seem to be listening more to each other than to small businesses and most Americans.
The Small Business for America’s Future survey makes it clear why small businesses want the American Jobs Plan. They think that it’s provisions will be good for the economy on a macro level and good for small business on a personal level — a virtuous cycle of shared growth and prosperity. And it’s not just investment in roads, bridges and rural broadband they support. They also want investment in the infrastructure that holds up the economy itself:
- 76 percent think the American Jobs Plan will help boost the economy as a whole
- 72 percent believe the American Jobs Plan will help small businesses specifically
- 87 percent support investments in affordable care for aging people and people with disabilities
- 76 percent support investments in living wages for care workers
- 70 percent support paid family and medical leave
- 75 percent support investments in affordable childcare
- 74 percent support investing in more jobs for care workers
Small business owners also see the American Jobs Plan as a way to bring fairness to a tax structure that has long favored corporations over Main Street. Again, the survey shows the extent of these views:
- 67 percent support increasing taxes on corporations to pay for the plan
- 77 percent say the current tax code favors large corporations over small businesses
- 75 percent believe large corporations do not pay their fair share of taxes
- 76 percent say small businesses are harmed when large businesses or corporations use loopholes to avoid paying taxes
- 51 percent do not believe raising taxes on Americans making over $400,000 a year would harm small businesses.
None of this should be surprising. In addition to a long-held desire to make the tax code more fair to small businesses, a new corporate tax rate will have no impact on the vast majority of the nation’s 30 million small businesses, which, let’s be clear, comprise 99.9 percent of all American businesses. Ninety-seven percent of small businesses will not be affected but will gain a more level playing field.
The bottom line is the American Jobs Plan will not increase the taxes of small businesses and it will stimulate local economies and benefit small businesses that provide goods and services, creating the economic uplift our Main Streets need.
Anne Zimmerman is co-chair of Small Businesses for America’s Future and a long-time small business CPA in Cincinnati, Ohio.