In a letter to Capitol Hill, the Big “I” and other organizations noted strong opposition to any reductions or repeal of the 20% deduction for qualified business income under Section 199A.
Earlier this week, the Big “I" joined more than 100 other trade associations in sending a letter to Capitol Hill opposing potential legislation that would weaken the Section 199A pass-through tax deduction that was passed as part of the Tax Cuts and Jobs Act in 2017.
Although changes to the small business tax deduction have been left out of recent tax proposals released by the Biden Administration, several congressional democrats have floated making changes to the deduction to pay for new spending proposals. Most concerning, Ron Wyden (D-Oregon), chairman of the U.S. Senate Committee on Finance, has signaled that he is working on legislation that would phase out the tax deduction starting at $400,000 and get rid of it altogether for those making over $500,000.
In the letter addressed to leaders of the Senate Committee on Finance and the U.S. House Ways and Means Committee, the Big “I" and other organizations note our strong opposition to any reductions or repeal of the 20% deduction for qualified business income under Section 199A, including phasing out the deduction above certain income thresholds.
The letter also states that without the deduction, individually and family-owned Main Street businesses would pay significantly higher taxes, putting them at a competitive disadvantage and accelerating the consolidation taking place in our economy. Finally, the letter makes clear the importance of the bipartisan legislation, H.R. 1381 and S. 480, the Main Street Tax Certainty Act, which would make the deduction permanent.
As Congress and the Biden administration continue to discuss tax policy and how to pay for their spending proposals, the Big “I" will continue to advocate on behalf of its members and provide updates in the weekly News & Views e-newsletter.
Wyatt Stewart is Big “I" assistant vice president of federal government affairs.