From Small Business & Entrepreneurship Council

The process for advancing a reconciliation bill continues to chug along, which can’t come soon enough for entrepreneurs and small business owners who urgently need a tax package that makes permanent expiring provisions of the 2017 “Tax Cuts and Jobs Act” and restores key measures that encourage investment and growth.

For now, talk of a big tax hike among some Republicans and in isolated corners of the White House has generally subsided. There is no way that a tax hike on entrepreneurs and small businesses would make it to the President’s desk. President Trump is indeed correct in noting that American taxpayers (read: capital) would take flight if taxes were raised. Moreover, a tax hike out of the Trump Administration and Congress would undermine the diligent work of the states that have been cutting taxes to promote business-friendly and taxpayer-friendly climates, and helping Main Street businesses compete more effectively. In mid-April, SBE Council joined our allies in the small business community and signed a letter to Congressional tax writers that opposed tax hikes on so-called high-income earners and “millionaires.”

Penalizing productive economic activity is not good policy, which also means that increasing taxes on carried interest is a bad idea. This bad idea is still percolating. As SBE Council chief economist Ray Keating wrote back in February when the idea surfaced:

“Increasing taxes on investment will negatively impact business startups and growth, and will inflict broad damages on incomes and jobs for workers, on entrepreneurship, on competitiveness, and on economic growth. Putting aside the political rhetoric, that’s the harsh economic reality if taxes are increased on carried interest.”

Consistency and certainty on policy across the board are vital to U.S. economic growth and competitiveness. Reducing, not increasing, government burdens and costs will support efforts to keep the United States the best place in the world to start and grow a business.

Secretary Bessent Very Optimistic. Today, on Day 100 of President Trump’s tenure in office, U.S. Treasury Secretary Scott Bessent is bullish on a tax bill. In a post on X, Secretary Bessent notes that the “Big 6” Hill leaders who are meeting on the tax bill are making great progress. He adds:

“I’m happy to announce that they are in substantial agreement and that this is going to be a very big, pro-growth win for the American people.”

A pro-growth win on taxes and positive progress on the trade/tariff front would certainly help to soothe worries and concerns about a possible recession. Experts are mixed on whether that will happen.

In a preview event on the “global economic outlook” hosted by International Monetary Fund (IMF) Managing Director Kristalina Georgieva, and attended by SBE Council President & CEO Karen Kerrigan, Ms. Georgieva predicted slower growth for sure, but not a recession.