Conservative economists criticize Harris’ new small-business tax proposal

Vice President Kamala Harris’ latest small-business tax proposal is facing significant pushback from conservative economists, who argue that the plan could have unintended consequences for economic growth and small businesses. Harris unveiled the proposal as part of a broader initiative to support entrepreneurs. Still, critics from the right contend that it would burden businesses with higher taxes and discourage job creation.

The proposal aims to increase taxes on businesses making over a certain threshold while providing tax credits and incentives for smaller, struggling enterprises. Harris and her supporters believe the plan will help level the playing field, allowing smaller businesses to thrive without being overshadowed by larger competitors. “We want to ensure that every entrepreneur has the opportunity to succeed, no matter their size,” Harris said during the proposal’s announcement.

However, conservative economists have been quick to pour cold water on the idea. Many argue that the tax hikes on larger businesses would trickle down and negatively affect the broader economy. Arthur Laffer, a well-known conservative economist, expressed concern, stating, “Higher taxes on any business, large or small, tend to lead to reduced investment and slower job growth. This proposal could have the opposite effect of what’s intended.”

Other critics argue that the proposal’s timing is particularly poor. With economic uncertainty and concerns about inflation still lingering, some experts believe that adding new tax burdens could further slow recovery efforts. “Small businesses are already struggling with inflation, labour shortages, and supply chain issues. Raising taxes now is not the answer,” said Stephen Moore, another conservative economist.

Supporters of the proposal counter that the tax increases are targeted at larger corporations, which they argue have benefited from past tax cuts and loopholes. They believe that redirecting funds to smaller enterprises through tax credits and incentives will encourage entrepreneurship and job creation where it is most needed.