Politics

Conservative economists pour cold water on Harris' new small-business tax proposal

Published

4 months ago

September 7, 2024

Conservative economists pour cold water on Harris' new small-business tax proposal

Conservative economists are pouring cold water on Vice President Kamala Harris’ new proposal aimed at reducing startup costs for new small businesses as part of her “Opportunity Economy” economic platform.

Harris unveiled new small-business tax proposals last week aimed at reducing the cost burden related to starting a new business. Among the proposals was a substantial increase in the standard tax deduction for small-business startup costs, from $5,000 to $50,000. “It’s essentially a tax cut for starting a small business,” the vice president said during a stump speech announcing the new proposal. “We’re going to help more small businesses and innovators get off the ground.”

Meanwhile, Harris has simultaneously expressed support for raising marginal tax rates for both corporations and individuals, which conservative economists argued would work to diminish the benefit received by the tenfold increase in the startup deduction.

“She wants to increase taxes on all kinds of income, on all classifications of income, so no matter how the small business is ultimately structured, they will still be paying more,” conservative economist E.J. Antoni told Fox News Digital. “Now, is that going to be diminished by this increase in the tax deduction? Absolutely. But, then, why are you doing both? That doesn’t make any sense.”

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Under the Trump administration, standard deductions were increased while marginal tax rates were lowered, Antoni pointed out. Additionally, under former President Trump’s tax cut measures, small business owners were allowed to claim a deduction for their “qualified business income.” It will ultimately be up to Congress to decide whether to keep any of Trump’s expiring tax cuts.

Trump spoke at the Economic Club of New York on Thursday, during which he laid out plans like lowering the corporate tax rate from its current 21% to 15%. Trump’s first-term tax cuts reduced it previously from 35%.

“Harris wants to do the opposite [of Trump],” Antoni said. “She wants to increase the deduction, but then increase the marginal tax rates.”

The economy consistently ranks as the most important issue for voters heading into a presidential election.

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Robert Wolfe, a Harris supporter and former chairman of UBS Americas, a global wealth management firm, pointed out that the tax rate increase for individuals will only impact those making more than $400,000.

“We want small businesses being built,” Wolfe said. “And we know that the ramp-up phase takes time, and so the idea that we wouldn’t applaud small businesses and entrepreneurs getting tax credits doesn’t make sense to me.”

Richard Stern, director of the Grover M. Hermann Center for the Federal Budget at The Heritage Foundation, said that under current tax laws, new business owners can already deduct most early-stage expenses, like payroll and equipment costs. Startup expenses, meanwhile, are defined under the tax code as those costs incurred prior to a business being registered with the federal government, which, according to Stern, are typically pretty minimal.

“Harris’ new tax deduction for small businesses isn’t a subsidy for starting a business per se,” he said. “It’s only useful if you actually spend $50K on pre-business expenses. So, this is disproportionately a subsidy for larger starting businesses.”

Stern also agreed with Antoni’s take that Harris is essentially giving to small businesses with one hand, while taking from them with the other.

Antoni, meanwhile, suggested that whoever is formulating economic policy for the Harris campaign is “building the train as it goes down the tracks.”

“It really seems like there were no policy proposals thought out ahead of time, and they are just throwing these things together,” he said.

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Vice President Kamala Harris helped create President Biden’s economic strategy known as “Bidenomics.” (Getty Images)

While right-wing economic experts argue Harris’ latest tax proposal would be diminished by her plans to raise taxes in other areas and do little to help inexperienced business owners start their first company, Roger Hochschild, a Harris supporter and former CEO at Discover Financial Services, says the move will be “critical to driving further economic growth.”

“I think she is very clear in her support of small businesses and acknowledging that they are the backbone of the economy,” Hochschild said.

Rhett Buttle, a former 2020 Biden campaign adviser, echoed that sentiment. He said the increased tax deduction proves Harris’ “deep commitment” to entrepreneurs, according to NBC News.

“There are broad strokes here to people from all walks of life,” he said. “Small business and entrepreneurship tends to be a great unifier in a world where people have starkly different political divisions,” Buttle said.

In addition to Harris’ new tax proposals for small businesses, she also laid out her plan this week for taxing capital gains. She wants to increase it to 33%, whereas Biden reportedly wants the current rate, which is at 23.8%, to be nearly doubled, according to The Wall Street Journal.

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A restaurant worker holds up a receipt with a note that reads “Vote Trump No Tax on Tip,” signed by former President Trump at a Philadelphia sandwich shop.

Fox News Digital reached out to the Harris campaign for comment on the criticisms about her small-business tax proposal, but was only directed to a social media post of a small business owner speaking at a Harris campaign rally.

“Do you think that your small business is better off now, than it was under the Trump administration?” NBC’s Gabe Gutierrez asked the entrepreneur.

“Oh, without a doubt,” the business owner, Brad Smith, responded. “And I think the reason is everything to do with optimism — if you’re a doom-and-gloom candidate, or president, you are not going to start a business.”

Politics

Biden Awards Medal of Freedom to Pope Francis

Published

5 hours ago

January 12, 2025

Press Room

Biden Awards Medal of Freedom to Pope Francis

President Biden awarded the Presidential Medal of Freedom with Distinction to Pope Francis on Saturday, granting one of the nation’s highest honors to a figure he called “the People’s Pope.”

“Pope Francis, your humility and your grace are beyond words, and your love for all is unparalleled,” Mr. Biden wrote on X. “You are a light of faith, hope, and love that shines brightly across the world.”

Mr. Biden honored the pontiff during a weekend in which he was scheduled to meet with the pope in person at the Holy See. The president, however, canceled the three-day trip to Italy to coordinate the federal response to raging wildfires in Los Angeles, according to a White House statement.

Rather than the usual award ceremony, in which the president places the award around the neck of the recipient, Mr. Biden posted on X an image from the Oval Office in which a military aide presented the medal. The White House announced the honor after Mr. Biden spoke to Pope Francis on Saturday and informed him of the award.

It was the first time during Mr. Biden’s term that he had awarded the medal “with distinction,” a more prestigious version of the honor. Mr. Biden received the recognition from President Barack Obama in 2017. Other recipients include Pope John Paul II and Colin L. Powell.

Mr. Biden, a Catholic, has seen Pope Francis as an admired ally on the global stage and turned to him as a sounding board, and the pope has lobbied for Mr. Biden to use his presidential power during his final weeks in office.

Last month, Pope Francis called Mr. Biden and asked him to commute the sentences of those on federal death row. Days later, Mr. Biden used his clemency power to soften their sentences to life in prison without the possibility of parole, sparing their lives.

A citation included in the White House announcement for the award said that Pope Francis was “unlike any who came before.”

“His mission of serving the poor has never ceased,” the statement read. “A loving pastor, he joyfully answers children’s questions about God. A challenging teacher, he commands us to fight for peace and protect the planet. A welcoming leader, he reaches out to different faiths.”

Mr. Biden awarded the honor days after bestowing the Presidential Medal of Freedom to 18 leaders of the political, financial and celebrity establishment.

Politics

Pence reveals words exchanged with President-elect Trump at Carter funeral

Published

5 hours ago

January 12, 2025

Press Room

Pence reveals words exchanged with President-elect Trump at Carter funeral

Former Vice President Mike Pence revealed his brief exchange with President-elect Trump, which was caught on camera at former President Carter’s state funeral.

The pair have not been seen publicly together since leaving the White House in disagreement over the 2020 election results. At the service at the National Cathedral, Pence stood up to shake Trump’s hand, and they appeared to exchange pleasantries.

Former second lady Karen Pence, who was seated next to her husband, did not stand up or acknowledge Trump.

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In an interview with Christianity Today, Pence said he “welcomed” the opportunity to speak with Trump.

“He greeted me when he came down the aisle. I stood up, extended my hand. He shook my hand. I said, ‘Congratulations, Mr. President,’ and he said, ‘Thanks, Mike,’” Pence said.

Former Vice President Al Gore, left, watches as former Vice President Mike Pence, center, shakes hands with President-elect Trump before a state funeral service for former President Carter at the Washington National Cathedral in Washington, D.C., Jan. 9, 2025. (Mandel Ngan/Pool/AFP via Getty Images)

Pence also recalled one of his final conversations with Trump in 2021, when he told Trump he would continue to pray for him. Trump responded, “Don’t bother,” the outlet reported.

“I said, ‘You know, there’s probably two things that we’re never going to agree on. … We’re probably never going to agree on what my duty was under the Constitution on Jan. 6.’ And then I said, ‘And I’m never going to stop praying for you,’” Pence told Christianity Today. “And he said, ‘That’s right, Mike, don’t ever change.’”

He said he kept his word.

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Robert F. Kennedy, Jr., speaks before former President Trump, the Republican presidential nominee, at a campaign event, Nov. 1, 2024, in Milwaukee. (AP Photo/Morry Gash)

While the two appeared to remain cordial at the service for Carter, Pence told the outlet he doesn’t think Robert F. Kennedy, Jr. is the right fit to manage Health and Human Services and was concerned about former U.S. Rep. Tulsi Gabbard serving as national intelligence director.

Fox News Digital reached out to Trump and Advancing American Freedom, a public policy advocacy organization founded by Pence, for comment, but did not immediately receive a response.

Fox News Digital’s Andrew Mark Miller contributed to this article.

Alexandra Koch is a breaking news writer for Fox News Digital. Prior to joining Fox News, Alexandra covered breaking news, crime, religion, and the military in the southeast.

Politics

Newsom to Trump: 'Respect the pleas of 40 million Americans'

Published

6 hours ago

January 11, 2025

Press Room

Newsom to Trump: 'Respect the pleas of 40 million Americans'

President-elect Donald Trump has not responded to Gov. Gavin Newsom’s invitation to tour California’s fire damage, Newsom said Saturday afternoon.

Newsom sent a letter on Friday inviting the incoming president to California to meet with fire victims, survey the devastation in Los Angeles County and join him in thanking first responders. The invitation, which the governor’s office said was emailed to Trump’s team, marked a slight change in tone in the political battle between Newsom and Trump, with Newsom imploring Trump not to politicize the tragedy.

Newsom delivered an acid-laced reply when asked Saturday whether he expected Trump to respond to the invitation.

“He’s an incoming American president,” Newsom told a reporter Saturday as he stood on a Los Angeles airport tarmac in front of a hulking CalGuard Black Hawk helicopter. “I would expect any leader of the free world, the most powerful person in the United States of America, to respect the pleas of 40 million Americans that happen to live in the state of California, hundreds of thousands of people that are still evacuated and a recovery effort that includes, right now, cadaver dogs to look for human remains, to be here for the American people at a time of emergency and a time of recovery.”

Trump’s office did not immediately respond to a request for comment.

Los Angeles County Board of Supervisors Chair Kathryn Barger echoed Newsom’s call with her own invitation to Trump on Saturday, imploring the incoming president to stand with county residents as they rebuild.

A catastrophic cluster of fires has wrought unprecedented destruction on the greater Los Angeles area in recent days, leveling thousands of structures and killing at least 13 people. The rebuilding effort will cost billions and test relationships at all levels of government.

President Biden, who has a close relationship with Newsom, has pledged that the federal government will cover 100% of disaster assistance costs to California for the next 180 days. But Biden leaves office on Jan. 20, and the recovery effort will likely sprawl for years to come.

Gov. Gavin Newsom speaks with reporters at LAX on Saturday.

(Carlin Stiehl / For The Times)

Newsom whose term in office ends in 2026, is widely seen as eyeing the White House. As governor, Newsom took advantage of the state’s position as the liberal antithesis to Trump to elevate his own national profile during the president-elect’s first term.

The war of words between the two men on social media and in news headlines gave Newsom an opportunity to define himself as a fighter for Democratic values that he argued the Trump regime sought to erode. Newsom and California similarly gave Trump a chance to call out the follies of Democratic rule, endearing the president to his own base.

Less than 36 hours after Trump won the 2024 presidential election, Newsom called a special session of the Legislature to give the California Department of Justice an extra $25 million to wage legal battles against the incoming administration.

The special session immediately reignited the California versus Trump narrative from four years ago, though Newsom has attempted to downplay any political motivation and said his experience proved the need to prepare to protect environmental policies, abortion access and other state priorities.

When asked Saturday whether he regretted calling the special session and publicly reigniting tensions with the incoming president, Newsom emphatically pushed back.

“Our preparing for the inevitable — which is an assault on our values, our diverse communities — we would be absolutely remiss not to prepare for that,” Newsom said, citing the myriad lawsuits the state litigated with Trump during his tenure and prior threats to withhold disaster assistance from the people of California.

But he also suggested that he worked as closely with Trump during the COVID-19 pandemic as any Democratic governor in America, taking the slightly more measured approach that he has put forth. During the president-elect’s first term, Newsom and Trump also maintained a friendly behind-the-scenes relationship, which appears to have since dissipated.

Newsom has forcefully pushed back on right-wing attacks on social media in the wake of the fires on social media in recent days and launched a website Saturday to actively debunk misinformation about the fire. The site refutes claims from Fox News that California cut its firefighting budget and shoots down allegations in social media posts about the state mismanaging forest lands.