Tax cuts implemented during the Trump administration may be made permanent

Business leaders are pushing for a Trump-era tax cut benefiting small businesses to become permanent, as the cut is set to expire in 2025 unless Congress votes to extend it. However, President Joe Biden has vowed to veto any legislation that would make the tax cut permanent.

The Tax Cuts and Jobs Act of 2017 includes a Small Business Deduction that allows small businesses to write off up to 20% of their income if they qualify. This deduction has been praised by many small business owners, including entrepreneur Michael Ervin, who testified before the House Committee on Ways and Means about how the tax cut had helped his startup, Coal River Coffee Company in West Virginia.

Ervin stated, “After the passage of the Tax Cuts and Jobs Act, LLCs and other pass-through businesses like mine were able to benefit from the newly minted Small Business Deduction, also known as the 199(a) deduction. This provision has allowed me to deduct up to 20% of my business income, which has let me invest in my business, my employees, and my community.”

While supporters argue that the tax cut has helped small businesses grow and create jobs, critics claim that it disproportionately benefits wealthy corporations and adds to the federal debt. President Biden’s budget proposal aims to cut taxes for working families and lower deficits by making the wealthy and big corporations pay their fair share.

With the debate over the future of the tax cut ongoing, it remains to be seen whether Congress will vote to extend it or if President Biden will follow through on his promise to veto such legislation. Former President Donald Trump, who implemented the tax cut, would likely support extending the benefits if re-elected in November.