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

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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. 

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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.

CRITICS BLAST HARRIS’ GRASP OF INFLATION, ATTACK ON BUSINESS AHEAD OF POLICY SPEECH: ‘LUNATIC BEHAVIOR’

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.”

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“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.”

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Trump stirs GOP primary drama with visit to Massie’s Kentucky home turf

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Trump stirs GOP primary drama with visit to Massie’s Kentucky home turf

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President Donald Trump is taking his feud with Rep. Thomas Massie, R-Ky., to the libertarian lawmaker’s home turf on Wednesday.

Trump is expected to hold an event in Hebron, Kentucky, on Wednesday, the Republican Party of Kentucky announced on social media Monday. It’s located in the northern part of the state’s 4th Congressional District, which Massie represents.

Massie’s primary rival, Ed Gallrein, will attend the Hebron event, his campaign confirmed to Fox News Digital on Tuesday, while deferring all other questions on the matter to the White House.

Massie himself will miss the event due to a previously scheduled official engagement, his spokesperson told Fox News Digital.

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President Donald Trump will be visiting Rep. Thomas Massie’s congressional district on Wednesday. (Win McNamee/Getty Images; Nathan Posner/Anadolu via Getty Images)

When asked about the visit, White House spokeswoman Liz Huston told Fox News Digital, “President Trump will visit the great states of Ohio and Kentucky on Wednesday to tout his economic victories and detail his Administration’s aggressive, ongoing efforts to lower prices and make America more affordable.”

The president has thrown his considerable influence behind Gallrein to unseat Massie after the GOP lawmaker publicly defied Trump on multiple occasions.

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Massie most recently was one of two House Republicans to vote to stop Trump’s joint operation in Iran with Israel, though the legislation was successfully blocked by the majority of GOP lawmakers and a handful of Democrats.

Ed Gallrein, left, seen with President Donald Trump in the Oval Office at the White House. (Ed Gallrein congressional campaign)

He was also one of two Republicans to vote against Trump’s “big, beautiful bill” last year.

Trump in turn has hurled a slew of personal attacks against Massie, including calling him “weak and pathetic” in a statement endorsing Gallrein in October.

“He only votes against the Republican Party, making life very easy for the Radical Left. Unlike ‘lightweight’ Massie, a totally ineffective LOSER who has failed us so badly, CAPTAIN ED GALLREIN IS A WINNER WHO WILL NOT LET YOU DOWN,” Trump posted on Truth Social at the time, one of numerous criticisms targeting the Kentucky Republican through the years.

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He called Massie the “worst Republican congressman” in July amid Massie’s bipartisan push to force the Department of Justice (DOJ) to release its files on Jeffrey Epstein.

Then-Rep. Marjorie Taylor Greene, a Republican from Georgia, Rep. Thomas Massie, a Republican from Kentucky, and Rep. Ro Khanna, a Democrat from California, during a news conference outside the U.S. Capitol in Washington, D.C., on Tuesday, Nov. 18, 2025. (Graeme Sloan/Bloomberg via Getty Images)

But Massie has so far appeared to defy political gravity despite making political enemies out of both Trump and House GOP leaders.

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He handily defeated multiple primary challengers in 2024 and 2022, despite public feuds with Trump, and has served his district since 2012.

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Gallrein is a retired Navy SEAL and farmer who launched his campaign days after Trump made his endorsement. Their primary election day is May 19.

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California Democrats launch pricey polling effort to winnow crowded gubernatorial field

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California Democrats launch pricey polling effort to winnow crowded gubernatorial field

As anxiety mounts among California Democrats about the potential of a Republican being elected governor, the state party will spend hundreds of thousands of dollars on polling to assess the viability of the sprawling field of candidates hoping to replace termed-out Gov. Gavin Newsom, according to plans released Tuesday.

The move comes after nearly every Democratic candidate refused party leaders’ call last week to withdraw from the race to avoid splitting the vote in the June primary — an outcome that could lead to a Republican being elected to statewide office for the first time in two decades.

“Candidates have filed, and now they’ve got the opportunity to showcase their viability, their path to win. I want to simply ensure that everybody has information to fully understand the current state of the race,” said Rusty Hicks, the leader of the California Democratic Party.

As campaign season ramps up, the series of six polls will allow “candidates, supporters, the media, voters, anyone and everyone to have a clear understanding of what is or is not happening in this particular race,” he said.

The filing deadline to appear on the June 2 ballot was Friday. Three days earlier, Hicks released an open letter urging candidates who did not have a path to victory to withdraw from the race. Of the nine prominent Democrats who had announced runs for governor, only one heeded his call: former state Assembly Majority Leader Ian Calderon.

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That means the eight other candidates’ names will appear on the ballot, regardless of whether they decide to later drop out. And that creates the possibility of a Republican winning the race because of how California elections are decided.

The state has a voter-approved top-two primary system, under which the two candidates who receive the most votes in the June primary advance to the November general election, regardless of party.

Two prominent Republicans will appear on the ballot: former conservative commentator Steve Hilton and Riverside County Sheriff Chad Bianco. Even though Democratic voters outnumber Republicans nearly 2 to 1, and the state’s electorate last elevated Republicans to statewide office in 2006, it is mathematically possible for Democrats to splinter the vote, allowing the two GOP candidates to advance.

Under such a scenario, not only would Republicans be guaranteed the leadership of the nation’s most-populous state, but Democratic voter turnout also would probably be depressed in November, potentially affecting down-ballot races such as those that could determine control of Congress.

Hicks’ call last week prompted concerns among candidates of color, including former U.S. Health and Human Services Secretary Xavier Becerra and state Supt. of Public Instruction Tony Thurmond, that the effort was aimed at every nonwhite candidate in the race.

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The state party chairman responded that his letter was not aimed at any specific candidate.

“It’s not something I lose sleep over,” Hicks said when asked about the racial claims. But he added that the voter surveys will be conducted by Los Angeles-based Evitarus, the state’s only Black- and Latino-led full-service polling firm, and will oversample historically underrepresented communities: Latino, Black and Asian American voters.

Hicks said the polling will cost “multiple six figures” but did not specify the exact amount.

The first poll will be released on March 24, and then five additional surveys will come out every seven to 10 days until voters start receiving mail ballots in early May.

“We’re putting this forward to ensure everyone is armed with the information they need to clearly have an eyes-wide-open assessment of where the state of the race currently is between now and when ballots land in the mailboxes of voters,” Hicks said.

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Trump reveals top issues GOP should focus on to secure midterms victory: ‘I’ve never been more confident’

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Trump reveals top issues GOP should focus on to secure midterms victory: ‘I’ve never been more confident’

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President Donald Trump outlined five key items he believes will tip the upcoming midterm elections in the GOP’s favor — if Republicans can muscle them through Congress.

“No transgender mutilation surgery for our children,” Trump told an audience at the Republican Members’ Issues Conference. “Voter ID, citizenship [verification], mail-in ballots, we don’t want men playing in women’s sports.”

It’s the best of Trump. Those are the best of Trump. This is the number one priority, it should be, for the House,” Trump said.

Trump’s exhortations to Republican lawmakers come as the GOP wages an uphill campaign to hang on to a controlling majority in the House of Representatives and the U.S. Senate. He framed his legislative priorities as a way for Republicans to capitalize on popular demands within the GOP base that would increase their chances of preserving a Republican governing trifecta.

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President Donald Trump gestures as he boards Air Force One before departing Palm Beach International Airport in West Palm Beach, Florida, on March 1, 2026. (Mandel Ngan / AFP via Getty Images)

HOUSE REPUBLICANS PUSH ELECTION OVERHAUL WITH VOTER ID, MAIL-IN BALLOT CHANGES AHEAD OF MIDTERMS

Currently, Republicans hold just four more seats than Democrats in the House of Representatives.

The GOP holds six more than Democrats in the Senate.

To keep the numbers in their favor, Republicans will need to beat historical trends. In the vast majority of past cases, parties that capture the White House in presidential elections face blowback in the midterms. Notably, the last time a majority party gained seats in both chambers of Congress in the midterms came under the Bush administration in 2002, following devastating attacks on the World Trade Center.

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House Speaker Mike Johnson, R-Louisiana, left, and President Donald Trump shake hands during an Invest America roundtable in the State Dining Room of the White House in Washington, District of Columbia, on June 9, 2025. (Yuri Gripas/Abaca/Bloomberg via Getty Images)

REPUBLICANS, TRUMP RUN INTO SENATE ROADBLOCK ON VOTER ID BILL

Trump said he believes Republicans have a shot at bucking the trend come November if they focus on his list.

“It’ll guarantee the midterms,” Trump said of his legislative priorities.

Republicans have already taken strikes towards two of them through the SAVE America Act, a piece of legislation that would require proof of citizenship to register to vote and cast a ballot. That bill cleared the House last month for a second time in the 119th Congress.

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Its future is uncertain in the Senate, where Republicans would need the assistance of seven Democrats to overcome the 60-vote threshold to defeat a filibuster. Democrats, for their part, believe the legislation would disenfranchise voters who cannot readily provide documented proof of citizenship through a passport, REAL ID, or birth certificate. 

Senate Majority Leader John Thune, R-S.D. has promised a vote on the package despite its long odds. 

Sen. Mike Lee, R-Utah, talks with a guest during a “Only Citizens Vote Bus Tour” rally in Upper Senate Park to urge Congress to pass the Safeguard American Voter Eligibility (SAVE) Act on Wednesday, Sept. 10, 2025. (Tom Williams/CQ-Roll Call, Inc via Getty Images)

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Several members have introduced bills on transgender issues, although none of them have cleared either chamber.

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I’ve never been more confident that if we keep these promises and deliver on this popular agenda, the American people will stand with us in overwhelming numbers, just as they did in 2024,” Trump said.

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