Kamala Harris has recently put forward a proposal to expand the tax deduction for small business start-up expenses from $5,000 to $50,000.
This move has drawn attention due to its alignment with a GOP policy that was rejected by most Democrat lawmakers six years ago but supported by every Republican member of the House.
The proposed expansion reflects similar legislation introduced by Republicans in the past, particularly Congressman Vern Buchanan (R-Fla.), whose bill aimed at increasing the deduction to $20,000 received unanimous support from House Republicans, while facing opposition from almost all Democrats.
Notably, this bill was backed by the Trump administration and formed part of a legislative package known as “Tax Reform 2.0,” designed as a continuation of the 2017 Trump tax cuts.
Under current law, small businesses are allowed deductions for various pre-operating expenses such as advertisements and salaries, with a cap set at $5,000.
Harris is expected to promote her proposal in New Hampshire as part of her ambitious plan to facilitate the creation of 25 million new small businesses during her first term in office.
This initiative aims to address the shortfall observed during President Joe Biden’s term, which saw only 19 million new small businesses established.
Harris’s proposal signals a departure from traditional Democratic stance on tax breaks for small businesses, which have often been criticized for primarily benefiting the wealthy—especially given that many such businesses operate as pass-through entities.
By advocating for this policy change, Harris seeks to present herself as more business-friendly than the current administration led by Biden and herself.
Following her rise to become the Democratic nominee for Vice President, Harris has been distancing herself from certain policies associated with the Biden-Harris administration that are perceived as detrimental to business and economic growth.
For instance, she expressed support for exempting service workers’ tips from taxation—a measure initially advocated by her former White House rival Donald Trump.
Additionally, she has stated that she no longer advocates for a ban on fracking—a position that contrasts with previous statements attributed to her.
She’s running on Trump policies she does not intend to actually implement, and Dems are buying it.
