President Joe Biden will fight to force taxpayers to pay even more corporate taxes in next week’s 2024 proposed budget, which is likely to impact both large and small businesses.
Although the business term “corporation” is widely associated with large companies like Chevron, Berkshire Hathaway, and McDonald’s, C-corporations can be both large and small businesses.
According to the Small Business Administration (SBA), 31.7 million small businesses exist in the United States. Eighty-one percent, or 25.7 million, have no employees (run and operated by a single person) and 19 percent, or 6 million, have paid employees.
The SBA also estimates that small businesses account for 65.1 percent (10.5 million) of net new job created from 2000 to 2019 and comprise 99.7 percent of firms with paid employees.
In mid-March, Biden will issue a proposed budget to Congress that will likely include tax increases on small businesses, intended to reduce the deficit from massive government overspending.
“I want to make it clear: I’m gonna raise some taxes,” Biden said in Virginia Beach on Tuesday.
Biden also mentioned raising taxes on corporations during the State of the Union Address. “And I will pay for the ideas I’ve talked about… by making the wealthy and big corporations begin to pay their fair share.”
It is unknown if Biden will tailor his proposal to only impact big businesses that have the resources to avoid as many taxes as possible.
Senate Majority Leader Chuck Schumer (D-NY) claimed Wednesday that Democrats believe the Trump administration tax cuts for both large and small corporations were bad for the economy. “There’s close to unanimity if not unanimity in our caucus that the Trump tax cuts were extremely bad for the country,” he said.
As many Democrats believe taxes should be increased on taxpayers, others fear raising them would hurt their political chances in battleground swing states, such as in the states of Sen Joe Manchin (D-WV), Sen. Jon Tester (D-MT), and Sherrod Brown (D-OH).
“I don’t know what he’s going to raise taxes on, that’s critical,” Tester responded when asked about Biden’s tax increase promises.
“If it’s about tax equity we’ll take a look at it. If it’s about across-the-board tax increases for everybody it’s probably the wrong time to do it because of inflation,” he added.
Raising taxes on small businesses would likely impact 31.7 million small businesses and their prospects of hiring and employing workers — many of whom vote.