Entrepreneurs and Small Business Must Be a Priority on Capitol Hill

By SBE Council at 13 January, 2025, 4:02 pm

“Policies must enable an environment that allows entrepreneurs to move beyond tepid growth and survival to one that encourages confident risk-taking, investment, and innovative growth.”

SBE Council Agenda (Part I)

As Washington welcomes the new Congress and Trump Administration, the Small Business & Entrepreneurship Council (SBE Council) is urging lawmakers to prioritize the needs of America’s entrepreneurs and small businesses.  SBE Council president & CEO Karen Kerrigan said that small business owners have navigated extraordinary challenges over the past four years, and providing them with stability and support will unleash opportunity, innovation, and growth for both the U.S. economy and in local communities nationwide.

“Thankfully, entrepreneurs and their employees have had access to a range of innovative technologies and tools that helped them weather inflationary pressures, labor shortages, and disruptions to supply chains and capital markets over the past four years. Tax relief and incentives within the Tax Cuts and Jobs Act (TCJA) were critical in providing financial support to small businesses when they needed it most. Looking forward, policies must enable an environment that allows entrepreneurs to move beyond tepid growth and survival to one that encourages confident risk-taking, investment, and innovative growth. Lifting the pain and uncertainty that comes with regulatory disruption and its costs and securing long-term tax relief will help to promote an enabling environment,” said Kerrigan.

On Capitol Hill and in conversations with the incoming Administration, SBE Council is supporting a wide range of policy and legislative initiatives that will help entrepreneurs and small businesses better compete for customers and workers, and access the capital they need to make investments and grow their businesses. Highlights of SBE Council’s 2025 agenda (PART I) include:

Tax Relief and Certainty: SBE Council is urging Congress and the incoming Trump Administration to quickly renew expiring small business provisions in the TCJA (the 20% small business deduction, lower individual income tax rates, higher threshold exemptions on death taxes, among other measures); restore incentives such as immediate R&D expensing and bonus depreciation; and to maintain or advance a more competitive corporate tax rate.

SBE Council will encourage Congress and President-elect Trump to work toward making the tax code less complex and to provide a check on efforts within the Internal Revenue Service that unfairly target small businesses (such as partnerships) for intrusive audits that aim to suck more capital from their firms. SBE Council will continue to call for the elimination of the Death Tax, indexing the capital gains tax for inflation, and restoring the 1099-K threshold level to $20,000.

A Rational Regulatory State: President Biden is leaving behind a federal regulatory system that knows no bounds. Regulators across the federal government – from the Department of Labor (DOL) to the Federal Trade Commission (FTC), the Consumer Financial Protection Bureau (CFPB) to the Securities and Exchange Commission (SEC), the Federal Reserve and more – have pushed through irrational and intrusive rulemakings that have consistently ignored rules and procedures required by federal law. While the courts continue to invalidate final Biden-era rulemakings and regulatory actions that have exceeded their statutory authority or not followed required procedures, hundreds of rules remain in place or are in the pipeline that harm small businesses, drive up labor and operational costs, restrict access to capital, and potentially undercut access to markets.

SBE Council will support efforts in the Congress to aggressively use the Congressional Review Act (CRA) to invalidate eligible rulemakings. We will support Executive Orders issued by President Trump to rein in and bring order back to the unruly regulatory system. As a start, SBE Council will urge Congress to quickly advance these bills introduced in the last Congress:

● The PROVE It Act

● Midnight Rules Relief Act

● Regulations from the Executive in Need of Scrutiny (REINS) Act

● Small Business Regulatory Reduction Act

● POST It Act

● The Employee Right Acts

● Save Local Businesses Act

The Corporate Transparency Act (and whether it will be enforced or not) is a dark cloud hanging over small businesses. SBE Council will work with our allies to immediately call for its repeal by supporting the “Repealing Big Brother Overreach Act.” DOL rules that have made it more difficult to become an independent entrepreneur, and new regulations that are driving labor costs higher and restricting working flexibility (such as the new overtime rule) must be invalidated or revisited. That is, if these regulations survive legal challenges. Biden administration efforts that are focused on regulating artificial intelligence (AI) may hamstring new innovation and the deployment and use of this critical technology, which is being wisely and widely adopted by small business owners and their employees. The new administration and Congress must tread humbly in this area and allow our entrepreneurs and tech leaders to create, in order to maintain U.S. innovative leadership.

Encouraging Startup and Small Business Growth: Capital and customers are the lifeblood of startups and small businesses. Without access to financial capital and revenue-generating opportunities, small businesses have no shot at survival. An economy that lacks successful small business growth is an economy that lacks vibrancy, innovation, and choices.

Uninformed and excessive regulation is undermining these two access points. For example, the CFPB, SEC and Federal Reserve have pushed unreasonable rules and restrictions on financial institutions and key players, which is constraining access to abundant and affordable capital.  Various FTC actions and some legislative proposals aim to unduly impair America’s leading tech platforms, which means the small businesses using their tools and platforms are harmed when access to customers and markets is restricted.

Moreover, the FTC has also pursued an anti-M&A agenda. Countless startups are being harmed by actions that work against their efforts to be acquired or to merge with another entity – a critical step that provides promising startups with the capital and expertise to scale and bring their innovations to the broader marketplace.

While the regulatory reform agenda noted above will help to curb these harms, Congress and the incoming Trump Administration can strengthen and improve the startup and small business ecosystems by turning back FTC rules that undermine positive M&A activity (such as new and unwarranted premerger notification requirements under the Hart-Scott-Rodino Act), strengthening capital markets generally, encouraging innovation across industries, and supporting the tech platforms and innovative technologies that are giving small businesses access to a larger customer base (including government procurement opportunities). In addition, improving and modernizing Small Business Administration (SBA) technical support is important to many small businesses. The agency must return to congressionally authorized programs, serve all eligible small businesses, and end political initiatives that have nothing to do with its mission.

Among other legislative initiatives, SBE Council will urge Congress and the incoming Administration to support the following bills proposed in the 119^th Congress:

● Empowering Main Street in America Act

● Expanding Access to Capital Act

● Improving Capital Allocation for Newcomers (ICAN) Act

● Equal Opportunity for All Investors Act

● Small Entity Update Act

● Small Business Investment Act

● Fair and Open Competition Act

● CBDC Anti-Surveillance State Act

● Financial Stability Council Reform Act

● Federal Improvement in Technology (FIT) Procurement Act

● Small Business Technological Advancement Act

● Comprehensive Resources for Entrepreneurs in the Arts to Transform the Economy (CREATE) Act

In addition, lawmakers need to update policies that boost investment crowdfunding, renew opportunity zones (which expire at the end of 2026), and improve the Qualified Small Business Stock (QSBS) tax exemption.

Affordable Health Coverage Choices: Expensive health coverage costs and limited options continue to frustrate small business owners and weigh down the competitiveness and growth of their firms. SBE Council will push forward with efforts to strengthen and improve health savings accounts (HSAs), encourage and expand telehealth, reform and improve the small business health tax credit, and revive progress during the first Trump administration that reduced barriers to small business pooling and transition coverage options for new entrepreneurs and the self-employed. Legislation SBE Council will support in the 119^th Congress includes, but is not limited to:

● HSA Modernization Act

● CHOICE Arrangements Act

● Paperwork Burden Reduction Act

● Small Business Flexibility Act

● Employee Reporting Improvement Act

Various Biden administration rules and legislative efforts advanced during the 117^th Congress – such as price controls within the Inflation Reduction Act (IRA) – keep the costs of drugs artificially high, and prevent small drug companies from pursuing their innovations and bringing them to market. SBE Council supports repealing these price controls and also advancing PBM reform to lower costs. Moreover, we will work to advance incentives and policies for small businesses that provide them with support and incentives to improve the overall health and wellness of their employees.  A healthier workforce is a happier and more productive workforce.

In Part II of SBE Council’s 2025 Agenda, we will cover the importance of pro-entrepreneur policy in the following areas: Broadband Access, Innovation & IP, Global Trade, Legal Reform, Energy, and Government Reform & Spending.