Plan would set goal of 25 million new small business applications; Plan would call for expanding the startup expense deduction from $5,000 to $50,000; Plan would cut red tape, including by making it easier for small businesses to file taxes and removing unnecessary or excessive occupational licensing requirements.
Vice President Harris and Governor Walz are fighting for an Opportunity Economy that unlocks Americans’ talents and ambitions, where everyone can compete and have a real chance to succeed. They know that small businesses and entrepreneurs—neighborhood shops, high-tech startups, small manufacturers, and more—are the engines of our economy. Small businesses employ half of all private-sector workers in America—creating 70 percent of net new jobs since 2019—and do trillions of dollars of business every year. Supporting small businesses will be one of Vice President Harris and Governor Walz’s highest priorities.
Today, Vice President Harris is announcing proposals to lift up our small businesses and entrepreneurs, promote innovation, boost growth, and build wealth for the middle class. She will launch an ambitious plan to allow 25 million Americans to take the first step toward starting a new business during the next four years, take on the everyday obstacles and red tape that can make it harder to grow a business, and drive economic growth all across America.
- Setting a Goal To Launch a Record 25 Million Applications To Launch New Businesses in the Next Four Years
Starting a business is an act of optimism in America’s economic future. Vice President Harris knows that with the right policies, we can give millions more people the confidence to take part in our long history as a nation of entrepreneurs. As Vice President, Kamala Harris led the Administration’s effort to help small businesses access billions of dollars in capital, driving growth in underserved communities across the country. She and Governor Walz will build on that success, setting a goal of 25 million new business applications by America’s entrepreneurs in their first term—exceeding the record 19 million new business applications already seen under the Biden-Harris Administration. Reaching Vice President Harris’ goal would mean 10 million more business applications than Trump saw during his term. And, it would importantly continue the needed progress to reverse the pre-pandemic trend of declining business dynamism that had reduced productivity growth and kickstart a further revival in more young, small, and innovative firms.
Helping More Entrepreneurs, Founders, and Innovators Start Up Their Businesses
- Helping Entrepreneurs Get Their Ideas Off the Ground With a $50,000 Deduction for Startup Expenses—a Ten-Fold Increase. Entrepreneurs need to have access to capital to launch their ideas. New small businesses spend an average of $40,000 to get set up during their first year of operations. To help give small businesses, entrepreneurs, and founders the confidence they’ll have the capital and security they need to get off the ground, a Harris-Walz Administration will call for expanding the startup expense deduction from $5,000 to $50,000—and allow new businesses to use the deduction immediately or in a future year to help reduce their taxes when they start to make a profit. For example, a small business who takes a loss in its first year can wait until future years to claim this deduction.
- Supporting New Businesses and Entrepreneurs in Manufacturing and Advanced Industry. The historic manufacturing and innovation renaissance spurred by the Biden-Harris Administration must continue to drive growth for small U.S. manufacturers, suppliers, and other businesses. To build out this work, Vice President Harris and Governor Walz are proposing to fund a network of new and existing federal, state, local, and private incubators and small business innovation hubs. This will be designed to ensure that small businesses and local suppliers are reaping the broader benefits of investments in semiconductor factories, Tech Hubs, and more—everywhere from Ohio to New Hampshire to Arizona. Incubators will help small businesses and local suppliers access technical assistance, capital, and customers to start or expand their business. Hubs will help advanced manufacturers commercialize by connecting them to contracts and clients, national laboratories and federally funded research facilities, technical assistance, and funding. This network will draw from both existing and new federal, state, and local programs and be designed to work with the private sector to strengthen the competitiveness of U.S. manufacturing.
These targeted proposals to encourage new business growth are closely aligned with Vice President Harris and Governor Walz’s plans to remove other barriers that commonly prevent hardworking Americans from taking a risk and starting a new business. They will tackle health care costs that can keep Americans—especially those with pre-existing conditions—from launching a new business venture, by protecting the Affordable Care Act and its critical support for individuals and small businesses. They will make permanent the $800-a-year premium tax credits for the millions of small business owners who get insurance from the ACA marketplace, and by working with states to forgive medical debt. They also have a plan—the boldest in a generation—to lower housing costs and support aspiring homeowners, helping give potential entrepreneurs the financial stability they need to start a business and hire workers.
Helping Small Businesses Expand and Grow Jobs
Helping Small Businesses Grow.
- Launching a Small Business Expansion Fund To Help Entrepreneurs Grow Their Businesses and Create Jobs With Low- or No-Interest Loans. Small businesses and entrepreneurs fuel growth and jobs. Too often, however, a small business may be concerned about the time it takes to generate the revenue needed to make initial loan payments. This new fund would enable community banks and community development financial institutions (CDFIs) to cover interest costs while small businesses are expanding. This fund will help get accessible and affordable capital to those small businesses who want to locate, innovate, and create jobs in communities across the United States.
- Ensuring One-Third of Federal Contract Dollars Go to Small Businesses. Contracts to provide goods and services for the federal government can help small business owners build generational wealth and hire workers by providing sustained funding. Under the Vice President’s leadership, the Biden-Harris Administration set new records for contracting with small businesses by dedicating more than 28%, or nearly $179 billion, of federal contract dollars to small businesses in FY 2023. However, rural small businesses are awarded less than 2% of federal procurement dollars, even though they make up more than 11% of overall U.S. small businesses. A Harris-Walz Administration will expand contract opportunities for rural and other underserved small businesses by directing at least one-third of federal contract dollars to small businesses by the end of her first term in office.
- Cutting Red Tape. Vice President Harris and Governor Walz are also focused on removing barriers that unnecessarily hold businesses back. Many regulations are essential to ensuring fairness, stability, and safety, but too many businesses can’t recruit the workers they need, set up shop, or expand their companies across states because of outdated or patchwork regulations. A Harris-Walz Administration will address that by:
- Making It Easier for the Smallest Businesses to File Taxes. Around one in three small business owners spend over a week filing taxes, and two in three spend at least $1,000 each year to do so. A Harris-Walz Administration will work to develop a standard deduction in the tax code—like the one available to individual filers—that can save the smallest businesses time and money by simplifying filing and give entrepreneurs peace of mind that they are tax compliant.
- Reducing Barriers to Excessive Occupational Licensing Requirements. Entrepreneurs and small businesses operating in multiple states or attracting workers from different states may have to get different occupational licenses in each state or rely on a workforce that has to get different occupational licenses in each state. Vice President Harris and Governor Walz will work to reduce this burden including by supporting grants to states to reduce unnecessary barriers to getting licensed, expand multistate licensing agreements to recognize substantially similar credentials, and speed implementation of multistate or universal licensing recognition. And, they will help expand programs like Registered Apprenticeships that lead to nationally recognized credentials that are portable across states. They will also instruct federal agencies to review and remove unnecessary licensing requirements and continue to reduce licensing burdens for military spouses, who often move across state lines, through further implementation of the Military Spouse Licensing Relief Act signed by President Biden. And, they will work to assist veterans, who can’t always use military occupational training and experience for civilian work.
- Modernizing the Federal Government for Small Businesses and Entrepreneurs. She will direct her administration to launch an initiative that modernizes outdated regulations and cuts unnecessary red tape that makes it hard for small businesses and entrepreneurs to apply and receive federal funding and other support.
- Encouraging States and Local Governments To Cut Red Tape. A Harris-Walz Administration will encourage and incentivize state and local governments to reduce burdensome regulations for small businesses, like simplifying business licensing; zoning processes; building, public way, and health permits; streamlining professional licensing; and modernizing reporting and compliance requirements. They would do this by leveraging federal funding and encourage states to standardize regulations across jurisdictions to streamline processes for businesses.
- Investing in All of America. Opportunity to turn a good idea into a new small business shouldn’t be limited to those with connections to big banks or to those in just a few big cities that have traditionally attracted venture capital dollars. That’s why Vice President Harris has been fighting to support small businesses in middle America, rural areas, and underserved communities across the country. As a Senator, she created a new program to expand access to capital in underserved communities through Community Development Financial Institutions (CDFIs). As Vice President, she championed efforts to get more financing and venture capital to all communities and oversaw the Biden-Harris Administration’s initiative to connect more communities of color and rural Americans to affordable and reliable high-speed internet. A Harris-Walz Administration will help new and existing businesses scale their operations by:Expanding Venture Capital and Innovative Financing To Small Businesses in Rural America, Middle America, and Underserved Communities. Vice President Harris will work to re-capitalize and expand the Treasury Department’s pathbreaking small business financing program, the State Small Business Credit Initiative (SSBCI)—which lifts up entrepreneurs and founders in rural America, middle America, and underserved communities. Under Vice President Harris’s leadership, this program was built out in the American Rescue Plan to catalyze $3 billion in funding for equity and venture capital to entrepreneurs across the country—so talent can take root anywhere in America. Vice President Harris is calling for additional funding to expand on proven ways to provide financing and venture capital to entrepreneurs and small business owners in all of America, while supporting increasing the capacity of lenders like CDFIs to provide such new financing to small businesses.Expanding Rural Partners Network Nationwide to All States and Territories. Communities and small businesses across America’s heartland have federal resources available to them that are often too difficult to access. Vice President Harris and Governor Walz will build on the pilot Rural Partners Network launched by the Biden-Harris Administration to make sure folks are getting the information and access they need across every state and territory. This will help entrepreneurs and economic development projects identify and successfully apply for federal funds.
Vice President Harris and Governor Walz believe in the hope that every small business inspires and will help these enterprises get off the ground and drive American prosperity and growth. Trump, by contrast, went out of his way to make it harder for small businesses and entrepreneurs to thrive. He made it easier for predatory lenders to charge high interest rates, tried to cut programs to support innovative startups, and directed pandemic relief funds away from smaller firms to large and well-connected corporations.
Ensuring Fiscal Responsibility while Encouraging Long-Term Investment Through the Tax System
Vice President Harris and Governor Walz are committed to fiscal responsibility—making investments that will support our economy, while paying for them and reducing the deficit at the same time. They also know we need to support America as a locus of innovators, entrepreneurs, and workers coming together to create a better future. They will foster the conditions that help businesses succeed and build faster.
The Vice President also believes that we need to chart a New Way Forward, by both making our tax system fairer and encouraging crucial investments in entrepreneurs and innovation. Vice President Harris supports rolling back Trump’s tax cuts for the richest Americans and implementing common-sense tax reforms for corporations and the very wealthy. She supports a billionaire minimum income tax, increasing the corporate tax to 28%, quadrupling the tax on stock buybacks, and other reforms to ensure that the very wealthy are playing by the same rules as the middle-class.
In addition, under her plan, 99% of Americans—including all moderate and middle-income families—will pay the same tax rate on long-term capital gains as they do now. Americans earning below about $100,000 will continue to pay no taxes and higher income families earning up to $1 million will continue paying up to a maximum rate of 20%. As Vice President Harris has committed repeatedly, no one earning less than $400,000 would pay a penny more in taxes.
For Americans who earn $1 million a year or more, the tax rate on their long-term capital gains increase from 20% to 28%—a rate put in place in the 1986 bipartisan tax reform and well below the rate proposed in the Administration’s Fiscal Year 2025 budget. In her view, this approach strikes the right balance. It would make our tax system fairer and responsibly raise revenue to reduce the deficit and fiscal risks, while maintaining the longstanding incentive in our tax system to invest in innovation and long-term investments that drive American growth. She is committed to ensuring that the wealthiest Americans and the largest corporations pay their fair share so we can grow our economy, reduce the deficit, and encourage investment and innovation.
Trump Will Keep Supporting Who He Always Has—Himself and the Biggest Corporations. Sixteen Nobel laureates agree that Trump’s economic agenda would ignite inflation, and other experts predict their anti-growth policies would trigger a recession by mid-2025, cost more than 3 million jobs, and add a percentage point to inflation. He’ll explode the deficit by $5 trillion or more and give tax cuts to the wealthiest. His national sales tax on everyday products like clothing, food, gas, and medicine that are imported will also raise costs for American families and small businesses by nearly $4,000. His Project 2025 agenda would cut funding for direct lending by the Small Business Administration and make it harder for underserved small businesses to access capital. He and Vance will undermine the independence of the Federal Reserve and other regulators and sow chaos and instability. As President, he left small businesses in the lurch during their time of need in the pandemic, instead helping big and well-connected corporations get funding more easily. We can’t go back to Trump’s failed approach. Vice President Harris and Governor Walz will chart a new way forward.