Show your Support for the Small Business Tax Deduction; Sign GCP’s Letter Now
Recent changes made by the Ohio House of Representatives to the state budget bill would substantially reduce the small business income deduction. Under the proposal, the amount of business income entities may deduct from their Ohio taxes would be reduced from $250,000 to $100,000. In addition, the proposal eliminates the flat 3% rate for qualified income above $250,000 and increases that rate to almost 5%.
GCP has long-supported the small business tax deduction as an important way for smaller business owners to reinvest back into their companies and workforces. Beyond this support, GCP has been an advocate for a sustainable and predictable tax and regulatory environment. The proposed changes to the small business tax deduction put both in jeopardy. In an effort to preserve the tax deduction in its current form and protect small businesses, GCP will submit a letter to the Ohio General Assembly that calls for the following:
1. Preserve Ohio’s current small business tax deduction, which is utilized by members for reinvestment back into their companies and workforces. Reducing the maximum deduction for business income by 60% is significant and would seriously jeopardize future planning and investments.
2. Maintain the 3% flat tax rate that pass-through businesses pay on earnings over $250,000. Because most businesses are set up as pass-through entities, they pay taxes on business income at the income tax rate of their individual owners. Ensuring the proper treatment for a variety of business types, expenses, and investments made by business owners—to support the growth of their businesses—is a critical focus in deliberations on tax policy.
We are calling on our small business members to consider signing the letter in partnership with GCP to show your concern, too. To show your support of the preservation of the small business tax deduction, opt-in to sign GCP’s letter here. Your voice matters in the fight to preserve both the tax deduction and a predictable tax environment.