WASHINGTON—Owners of closely held businesses would still get a 20% tax deduction under President Biden’s tax plan, leaving high-income peopl
WASHINGTON—Owners of closely held businesses would still get a 20% tax deduction under President Biden’s tax plan, leaving high-income people who run construction companies and manufacturing firms benefiting—for now—from a provision that Republicans created in 2017 over Democratic opposition.
Although Mr. Biden campaigned on limiting the break, the deduction went untouched in the first $2.4 trillion worth of net tax increases that were detailed by the Biden administration on Friday.
Administration officials haven’t said why they haven’t proposed curbing the break at this point, and the White House didn’t comment. Treasury officials said Friday that some campaign proposals need more work and others may appear in future plans.
The deduction “just seems to be kind of without redeeming qualities and frankly, I was a little surprised that the Biden administration didn’t propose curtailing it,” said William Gale, a senior fellow at the Brookings Institution, a left-leaning Washington think tank.
Kevin Kuhlman, vice president of government relations at the National Federation of Independent Business, said he had been bracing for the deduction to be removed.