Congress could raise taxes by more than $400 billion on small individually and family-owned businesses
The National Lumber and Building Material Dealers Association (NLBMDA) said it has sent a letter to House and Senate leadership urging the rejection of any tax increases to pay for President Biden’s “Build Back Better” agenda using budget reconciliation.
According to the NLBMDA, budget reconciliation allows Congress to bypass traditional filibuster rules and fast-track legislation with provisions strictly related to spending and revenues. Congressional Democrats are targeting reconciliation to raise taxes and pay for their healthcare, energy and climate change priorities. Read the full letter here.
Two proposals under consideration would raise taxes by more than $400 billion on small individually and family-owned businesses over the next ten years. This includes expanding the Net Investment Income Tax (NIIT) and increasing limits on excess business loss deductions for non-corporate taxpayers. NLBMDA strongly opposes any tax hikes on small businesses that represent the backbone of the American economy.
The letter reads:
“Raising taxes on small and family-owned businesses with the economy on the brink of a recession, a situation which is compounded by the other post-pandemic challenges they face, harms not only the businesses but the families and communities who rely on them. We ask you to reject these or any tax hikes on America’s small and family-owned businesses in any legislation considered this year”
The NLBMDA has also issued a statement regarding tax increases. Here’s what the association had to say:
With a 50-50 party split in the U.S. Senate, Senate Majority Leader Chuck Schumer (D-NY) needs the support of the entire Democratic caucus to pass a spending bill. Following our letter, Senator Joe Manchin (D-WV) announced that he would not support tax increases on small and family-owned businesses in any reconciliation package. In lieu of expanding the NIIT and limiting deductions for small businesses, Manchin and Schumer released a deal last night that relies on an alternative minimum tax (AMT) of 15% on corporations with profits in excess of $1 billion.
While we applaud the decision to protect small businesses from higher tax rates, NLBMDA continues to lobby against harmful tax increases that would burden our members and slow our nation’s economic recovery. We have serious concerns that additional tax increases will be considered and negotiated in the coming months.
NLBMDA encourages members to utilize the Grassroots Action Center which allows anyone to easily contact their Members of Congress in support of the LBM industry’s tax priorities. NLBMDA will continue to update members on the latest developments as it pertains to reconciliation and tax legislation.
The letter sent to members of Congress was also signed by the National Association of Home Builders (NAHB) and Associated Builders and Contractors (ABC) who have both said they oppose proposed tax increases.