Show-Me State Times

The National Federation of Independent Business (NFIB) has released a report discussing the potential impact of the 20% Small Business Tax Deduction becoming permanent in Missouri. According to NFIB, if Congress does not act to make this provision permanent, it could lead to a significant tax increase for the state's 579,000 small businesses. This change could result in severe consequences for Missouri's businesses and the overall U.S. economy, possibly causing an economic slowdown and financial challenges for local enterprises.

The NFIB's report indicates that if the deduction expires, small businesses in Missouri will face a substantial rate hike. The small business tax rate could rise to 44.3%, compared to a 25% tax rate for C-Corps. If the deduction becomes permanent, it could provide a level playing field for small businesses in comparison to their larger corporate competitors.

In addition to leveling tax rates, making the deduction permanent is projected to create 23,000 new jobs annually in Missouri over the decade. The state's GDP is expected to rise by $1.12 billion annually during the initial ten years, with projections climbing to $2.32 billion per year beyond 2035.

Brad Jones, NFIB Missouri State Director, emphasized the urgency of the situation: “Missouri’s small businesses are essential for job creation and strengthening our local economy. If Congress allows the 20% Small Business Deduction to expire, a massive tax hike on small businesses will take effect, which will stifle growth and delay hiring plans. With the deduction set to expire this year, lawmakers must act quickly to protect small businesses and the communities they support.”

The 20% Small Business Tax Deduction originates from the Tax Cuts and Jobs Act of 2017, which has helped many small business owners to expand and hire. If Congress does not take action, nine out of ten small businesses nationwide might face a higher tax burden, potentially threatening jobs and economic stability.

For further details on NFIB's advocacy and the report about Missouri, visit www.nfib.com/stopsmallbiztaxhike.