How Will the Biden Administration Support Small Businesses?
After perhaps the most consequential and unique campaign in modern US history, former Vice President Joe Biden has earned a new title: president-elect. Along with this new title comes speculation as to who will serve in his administration, what policies will take priority, and what changes will a Biden presidency bring to Washington, Wall Street and Main Street. For those in the startup and entrepreneurial ecosystem, pressing questions revolve around taxes, Covid-19 relief, and how the new administration will support business owners and foster innovation.
During the campaign, the Biden camp assembled an impressive Small Business and Entrepreneurs Advisory Council. “In addition to current and former small business owners and entrepreneurs, the council includes elected officials and former cabinet members…” (JoeBiden.com) The team includes former Small Business Administration (SBA) chief Maria Contreras-Sweet, Ben and Jerry’s co-founders Ben Cohen and Jerry Greenfield, and entrepreneur and former Democratic presidential candidate Andrew Yang.
While we don’t know who will be inside the Biden administration advocating and working for small businesses, we do know that one of Biden’s clearly identified priorities is Covid-19 relief for small businesses. During the campaign, Biden’s team released their plans to increase oversight of the Payroll Protection Program (PPP) and provide any small business with 50 or fewer employees with financial assistance through the program.
Beyond the pandemic, President-elect Biden has pitched a new Small Business Opportunity Fund, a $30 billion investment in small businesses and entrepreneurial ventures. Of that $30 billion, $10 billion would be directed to state and local initiatives that provide venture funding.
With a substantial increase in funds for small businesses, comes the need to pay for these programs. Biden ran on a promise to not increase the tax bill for any citizen earning less than $400,000 a year.
For wage earners in the top tax bracket, their rate will move up to 39.6%. In addition to a tax increase on certain personal incomes, Biden’s goal is to raise the corporate tax rate—currently 21%—to 28%, and impose a minimum rate of 15% on book income “so that no corporation gets away with paying no taxes.”
With plans in place, and cabinet announcements expected by the end of the month, President-elect Joe Biden has been tasked with stopping a raging virus, righting the economy, and ensuring small businesses owners and entrepreneurs have the necessary access to capital and resources to weather a storm and innovate for the future.
Adam Tidrow, MBA, business development officer at PathStone Enterprise Center, Inc., is a startup expert in Buffalo, New York. He is the author of “The 7 Page Business Plan: Your Guide to Planning, Starting, and Running Your Business.”