New Study Confirms Senator Daines, Rep. Smucker Small Business Tax Deduction Supports Millions of American Jobs, Spurs Economy

U.S. Senator Steve Daines (R-MT) and Congressman Lloyd Smucker (R-PA-11) today shared a new study from Ernst and Young (EY) highlighting the economic activity supported by their small and family-owned business tax deduction. The Section 199A deduction provides a 20 percent deduction for pass-through businesses, allowing these businesses to reinvest their hard-earned capital, increase wages and hire more employees. The new study found that 2.6 million jobs and $325 billion of GDP are supported by the deduction. Daines and Smucker introduced the “Main Street Tax Certainty Act” to make this 20 percent pass-through business tax deduction permanent.

“It’s no surprise that when we provide our small businesses with much-needed tax relief, they not only thrive, but they help the whole economy grow. It’s time this tax deduction is made permanent so that Montana small and family-owned businesses can continue to create jobs, serve their communities and spur economic activity,” Senator Daines said.

“This report underscores what I have heard directly from small and family-owned businesses in my community and across the nation. Section 199A allows main street businesses to grow, create jobs, and invest in their community. Making Section 199A permanent will prevent a massive tax hike and provide small business owners and their employees the certainty they need to thrive,” said Rep. Lloyd Smucker (PA-11), a member of the tax-writing Ways and Means Committee and lead sponsor of the “Main Street Tax Certainty Act” in the House.

“Making the Section 199A small and family business deduction permanent is essential to blocking a massive tax increase on Main Street businesses while ensuring they remain competitive with the lower rate applied to larger, public corporations. This study makes clear that 199A supports millions of jobs located in thousands of communities around the country. Without it, those communities would have fewer jobs, lower wages, and smaller economies. The Daines/Smucker Main Street Certainty Act needs to be part of any tax package considered by Congress next year,” said Brian Reardon, President of the S Corporation Association.