Michael Iosua Director | NFIB Hawaii
Michael Iosua Director | NFIB Hawaii
The National Federation of Independent Business (NFIB) has released reports highlighting the potential benefits for Hawaii if the 20% Small Business Deduction in the federal tax code is made permanent. The deduction, part of the 2017 Tax Cuts and Jobs Act, is currently set to expire at the end of 2025.
According to a report by EY (Ernst & Young), “The tax change is estimated to increase US job equivalents at small businesses by approximately 1.2 million jobs, on average, in each of the first ten years and growing over time to 2.4 million each year after that.” Additionally, it states that “permanently extending the Section 199A deduction is estimated to increase US GDP at small business by $75 billion annually, over the first 10 years; and growing over time to $150 billion annually each year thereafter.”
For Hawaii specifically, these projections translate into an increase of 4,000 jobs and $210 million in GDP each year for the first decade. After 2035, these numbers are expected to grow to 7,000 jobs and $433 million annually.
An NFIB survey indicated that if the Small Business Deduction expires as scheduled, a significant percentage of businesses plan to take actions such as raising prices (61%), postponing or canceling capital investments (44%), and delaying hiring additional employees (36%).
Jeff Brabant, NFIB’s vice president of Federal Government Relations, testified before the Senate Committee on Finance emphasizing support for making this deduction permanent. He remarked, “Members of Congress should ask themselves if they really believe it when they say ‘small businesses are the backbone of America.’ If they truly believe that statement and value small businesses in their communities, then making the 20% small business deduction permanent should be an easy decision.”
NFIB has been advocating for small and independent business owners across America since its founding in 1943. For more information on their efforts and updates on Hawaii's small-business news, visit nfib.com/hawaii or follow NFIB Hawaii on X @NFIB_HI.
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