Beaver State News

The National Federation of Independent Business (NFIB) has released a report detailing the implications of the potential expiration of the 20% Small Business Tax Deduction in Oregon. According to the NFIB, this deduction has played a crucial role for small businesses under the Tax Cuts and Jobs Act of 2017 by enabling expansion, job creation, and wage increases.

NFIB's analysis suggests that more than 409,000 small businesses in Oregon could see a significant increase in taxes if Congress does not act to make this deduction permanent. "If Congress allows the 20% Small Business Deduction to expire, a massive tax hike on small businesses will take effect, stifling growth, putting the brakes on hiring, and endangering countless small businesses," said Anthony Smith, NFIB Oregon State Director.

The report highlights a potential increase in tax rates for small businesses, which could rise to 49.5%, contrasting with the steady 28.6% state tax rate for larger corporations. If the 20% deduction remains, Oregon could see the creation of 18,000 new jobs annually over the next decade and an annual GDP increase of $986 million initially, reaching $2.04 billion per year beyond 2035.

With the expiration date approaching, NFIB emphasizes that nine out of 10 small businesses could endure a heightened tax burden, posing threats to jobs and economic stability across the nation.

"Small businesses don’t just create jobs—they create opportunity, innovation, and strong local economies," Smith added, underscoring the need for lawmakers to act swiftly to maintain the deduction and safeguard the benefits it brings to local communities.