Senator’s bipartisan legislation empowers Arizona small businesses with the economic freedom to grow and thrive
WASHINGTON – Arizona senior Senator Kyrsten Sinema, along with Republican Senators Shelley Moore Capito (W.Va.) and John Barrasso (Wyo.), introduced the American Investment in Manufacturing Act – legislation that cuts costs for Arizona small businesses and empowers them with the economic freedom to grow and thrive.
“We’re empowering Arizona small businesses with the economic freedom to grow and thrive by cutting harmful costs in the tax code,” said Sinema.
“In the midst of continued high inflation, high interest rates, and increased taxes burdening U.S. businesses, additional limitations like these jeopardize American manufacturers, retailers, and service providers’ ability to remain viable and compete on the global stage. This bipartisan legislation would reinstate a needed measure that allow industries to, grow, increase jobs and wages, and contribute to the U.S. economy. I’m proud to stand with American businesses, and I encourage my colleagues to join in support of this reinstatement,” said Capito.
Sinema’s legislation fixes the U.S. Tax Code to allow small businesses deduct interest expenses and reduce their federal tax burden. This change cuts harmful costs for Arizona small businesses, including manufacturers, retailers, broadband providers, health care systems, and restaurants.
The 2017 Tax Cut and Jobs Act set a new 30% limitation on interest deductions on Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA). This law also made the EBITDA more restrictive over time. Beginning in Tax Year 2022, depreciation and amortization were removed from the calculation (EIBT) – further limiting the ability for small businesses to deduct interest expenses. These changes have made a negative impact on the manufacturing sector and combined with the current high interest environment, small businesses have been affected much harder than anticipated. Sinema’s legislation seeks to fix provisions of the 2017 Tax Cut and Jobs Act to ease the burden and cut harmful costs to Arizona small businesses.