Kamala Harris’ Focus On Small Business: Her Job Creator Plan

On Wednesday, Vice President Kamala Harris announced her “Entrepreneurs & Innovators Policy Plan” that will support small businesses, entrepreneurs, innovation, and economic growth. As previously reported, over her career, the Vice President has long been committed to supporting small business and entrepreneurs.

Her campaign announcement during a speech in North Hampton, New Hampshire, at the Throwback Brewery, a women-owned business that has been in operation for more than a decade, gives us more insight into what her priorities for small business, entrepreneurs and innovators would look like. The Biden-Harris Administration has prioritized Main Streets across the country through legislation and executive orders. These efforts have led to 19 million in new recorded business applications since the start of the Biden-Harris Administration, an unprecedented number. Small businesses have also created 70% of net new U.S. jobs since 2019.

Vice President Harris’ plan calls for building on this success by setting a goal of 25 million new small-business applications during her first term. Here are the policy proposals designed to achieve it:

Tax Deductions

It takes on average about $40,000 to launch a small business for items that include market surveys, advertisements, equipment, and salaries for workers in training. However, the tax deduction for start-up expenses is currently $5,000. Vice President Harris’ plan would push for expanding this deduction to $50,000 for new small businesses to cover more of these costs and provide more flexibility on when and how they can claim it. For example, if they wait until they are bringing in profits, the deduction may be more beneficial to businesses at that time.

In addition, she has proposed a series of standard deductions for small businesses in filing taxes. An estimated 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 standard deduction in the tax code akin to one available to individual filers can save the smallest businesses time and money.

Expanding Contract Opportunities

Vice President Harris also pledged that in her first term, one-third of all federal contract dollars will go to small businesses by expanding contract opportunities for rural and other underserved small businesses. The Small Business Administration’s current goal is for 23% of prime government contract dollars to go to eligible small businesses so this would be a significant increase. This represents an increase of more than $20 billion in revenue to small firms.

Small Business Expansion Fund

One challenge facing underserved Main Streets and communities is difficulty to attract capital. This is compounded by the fact that a small business needs time to generate the revenue needed to make initial loan payments. Vice President Harris’ plan would aim to address this by launching a small business expansion fund where community banks and Community Development Financial Institutions (CDFIs) to cover interest costs while small businesses are expanding. This fund will help small businesses who want to locate, innovate, and create jobs in communities across the United States have access to affordable capital. It also builds on the State Small Business Credit Initiative (SSBCI) 2.0, which was part of the American Rescue Plan, which provides funding to states, territories, and eligible municipalities to expand existing or to create new state small business investment programs.

Less Burdensome Regulations

The Vice President has also proposed steps to reduce bureaucracy for small business owners through efforts that include making it easier to obtain occupational licenses for workers and businesses to operate across state lines. Additionally, her plan would also create incentives for states and local governments to reduce burdensome small business regulations, such as simplifying business licensing, zoning processes, and building, public way, and health permits.

Several of the policy proposals she has outlined have already been championed by Democrats and Republicans. With that in mind, it is refreshing to see that she is already laying out her plans for job creators across the country and significant to see a presidential candidate develop an intentional strategy in support of the small businesses that play a critical role in our economic growth.