Rep. Smucker’s Main Street Tax Certainty Act: What Are They Saying?
Washington – Congressman Lloyd Smucker (PA-11) introduced the Main Street Tax Certainty Act, H.R. 4721, legislation which would permanently extend Section 199A of the Internal Revenue Code, which is slated to expire in 2025. Smucker’s bipartisan legislation is cosponsored by nearly 100 Members and is supported by all Republican Members of the Ways & Means Committee.
Here is what community leaders across the Commonwealth and Pennsylvania’s 11th Congressional District have to say about Rep. Smucker’s Main Street Tax Certainty Act:
“The Main Street Tax Certainty Act would help support millions of American small- and individually owned businesses during a critical time in our economic recovery,” PA Chamber President and CEO Luke Bernstein said. “These companies are the backbone of our economy, employing the vast majority of private-sector workers. The passage of the Main Street Tax Certainty Act will foster economic growth and help Pennsylvania’s small businesses, S-corporations, and sole proprietorships remain competitive while overcoming the long-term financial impacts of the pandemic. We applaud Congressman Smucker for his leadership and urge Congress to quickly make the pass-through deduction permanent so that these employers have the certainty they need.”
“Small businesses strengthen and sustain our local economy, making up more than 97% of businesses in Lancaster, PA. They create jobs, stimulate local spending, foster innovation, and contribute to the overall growth of our community. Helping small businesses stay competitive and keep their doors open is critical for the success of our community and for those across the nation. This is why the Lancaster Chamber supports the Main Street Tax Certainty Act of 2023, which would permanently extend Section 199A of the Internal Revenue Code. This 20-percent deduction for small and family-owned businesses promotes equity in America's tax code between main street businesses and large corporations and ensures businesses everywhere can continue to thrive.” - Heather Valudes, President & CEO of the Lancaster Chamber
“The Main Street Tax Certainty Act is a bipartisan effort to provide stability, permanency, and, as the bill’s name states, certainty by keeping the Small Business Deduction from expiring in 2025. This legislation ensures permanent tax relief for employers – including the hundreds of businesses that line our main streets throughout York County and the Commonwealth,” said York County Economic Alliance President & CEO, Kevin Schreiber.
“Making the small business deduction permanent by passing the Main Street Tax Certainty Act, H.R. 4721 will enable small business growth and job creation that is essential to consistent economic growth in the future,” said Gary Laird, Hanover Area Chamber of Commerce President.
“We commend Congressman Smucker for introducing this important bill to ensure that small businesses’ tax burden is fair. The Section 199A deduction supports small businesses who are creating jobs or investing to grow their business. It should be made permanent, which the bill would do,” said Karen Watkins, Executive Officer of the Building Industry Association of Lancaster County.
"When it comes to the nation's business climate, predictability is one of the chief concerns for any company," said Alex Baloga, President and CEO of the Pennsylvania Food Merchants Association. "By making permanent Section 199A, Congressman Smucker's Main Street Tax Certainty Act will let small businesses continue to count on equitable treatment under the tax code. Many smaller food retailers, wholesalers, and distributors throughout Pennsylvania are owned by individuals or families. Despite unprecedented challenges and often the smallest of margins, they work hard every day to ensure their neighbors and communities have healthy, nutritious options. Each one stands to benefit from Congressman Smucker's legislation, and the reassurance of knowing a tax increase set to hit them at the end of 2025 will be averted. PFMA applauds Congressman Smucker for his bill and encourages its swift passage."
“There are nearly 69,000 trucking companies in the state of Pennsylvania, the vast majority of which are small, locally owned businesses. These companies keep America’s supply chain running. Section 199A’s provisions help level the playing field for these companies, most of which are pass-through businesses, allowing them to stay competitive with big organizations,” said President and CEO of the Pennsylvania Motor Truck Association Rebecca Oyler. “We are grateful to Congressman Smucker for introducing a necessary bill to make this provision permanent, which will have an undeniably positive impact on the trucking industry.”
“Pennsylvania Farm Bureau (PFB) consists primarily of small family farms, who benefit from the 20 percent tax deduction under Section 199A. Without the Section 199A Qualified Business Income deduction available, small producers will be at a severe financial disadvantage and subject to high overall tax rates when compared to corporations. The passage of H.R.4721, the Main Street Tax Certainty Act is crucial because our family farms need Section 199A to become permanent, rather than expire in 2025. Not only will current farmers and ranchers see the benefits of the 20 percent deduction, but this will give our generational farms a higher chance of continuing the family farm. PFB continually looks for ways to make the agriculture industry more viable and appealing for current and future producers, and H.R.4271 is another way to achieve that goal. – Chris Hoffman, President of Pennsylvania Farm Bureau
“Pennsylvania small business owners thank Rep. Smucker for re-introducing this critical legislation,” said Greg Moreland, NFIB Pennsylvania State Director. “The Small Business Deduction has been a crucial tax deduction for small business owners in the Commonwealth as it has allowed owners to reinvest in their business and employees. We ask Congress to pass the Main Street Tax Certainty Act and make the Small Business Deduction permanent.”
“The National Association of REALTORS® and the REALTORS® Association of York & Adams Counties thanks Congressman Smucker, Senator Daines, and the many cosponsors of these important bills for their commitment to making the Qualified Business Income Deduction permanent. This deduction was the most important feature of the Tax Cuts and Jobs Act for much of Main Street America. The vast majority of REALTORS® operate their businesses as sole proprietorships, partnerships, limited liability companies, S corporations, or other forms of pass-through entities, and the deduction allows these businesses to share in the corporate tax reduction enacted in 2017. If the deduction were to expire at the end of 2025, it would have wide-reaching consequences for the real estate industry, which constitutes nearly one-fifth of the U.S. economy.” – Shanna Terroso, Executive Officer, REALTORS Association of York & Adams Counties
"Amidst the various challenges faced by small businesses in the hospitality and lodging industries, from labor shortages to escalating costs, Congressman Smucker's Main Street Tax Certainty Act is the support the industry needs,” PRLA President & CEO Joe Massaro said. “Many of Pennsylvania’s hospitality and tourism attractions, like bed & breakfasts, are small businesses. Seven in ten restaurants are single-unit operations and nine in ten have fewer than 50 employees. Additionally, 41 percent of restaurants are minority owned. This crucial legislation cements its commitment to Pennsylvania's defining small businesses.”
“The legislation allows for continued use of a small-business deduction that will ensure the prosperity of our Main Street establishments, empowering them to flourish, expand, invest, and create job opportunities. In doing so, it paves the way for thousands of small businesses, which form the backbone of Pennsylvania's economy, to thrive and contribute even more to the Commonwealth’s growth."
Background:
Section 199A, which was adopted as part of the landmark 2017 Tax Cuts and Jobs Act, allows for a 20 percent deduction of qualified income for pass-through businesses. Most small business are structured as a pass-through and this section was included in the Tax Cuts and Jobs Act to promote equity in America’s tax code between small businesses on main street with larger corporations.
Section 199A allows up to a 20 percent pass-through income deduction for small businesses organized as sole proprietorships, partnerships, S corporations, trusts, or estates, or income from qualified REIT dividends and income from publicly traded partnerships.
A recent study from the S Corporation Association, which represents individual and family-owned businesses, reports that tax parity between small businesses organized as pass-through entities and corporations will end if Section 199A ceases to exist. Additionally, another report from the S Corporation Association indicates “private companies organized as pass-through businesses employ 58 percent of all private sector workers.”
Sen. Steve Daines (R-MT) introduced companion legislation in the United States Senate, which has 18 cosponsors.
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