Senators’ bipartisan legislation helps small businesses grow and create opportunities by allowing them to deduct interest expenses and invest in their businesses
WASHINGTON – Arizona senior Senator Kyrsten Sinema and Republican Senator Shelley Moore Capito (W.Va.) led a bipartisan briefing on how their American Investment in Manufacturing (AIM) Act empowers small businesses with the economic freedom to grow and thrive, creating opportunities in Arizona and across the country.
“In Arizona, small businesses power our economy and create opportunities for everyday Arizonans by making up over 99.5% of all our businesses. That’s why I’m laser focused on helping them thrive and build a healthy economy, so all Arizonans can build better lives for themselves and their families,” said Sinema.
Sinema and Capito’s legislation provides tax relief and allows small businesses to deduct interest expenses and reduce their federal taxes. 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 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 and invest in their businesses.
These changes have made a negative impact on the manufacturing sector and, combined with the current high interest environment, more small businesses have been affected than anticipated. Sinema and Capito’s AIM Act seeks to ease the burden and cut harmful costs to Arizona small businesses. Senator Sinema continues to speak to colleagues on both sides of the aisle about the need for congressional action on commonsense bipartisan tax policies, including the AIM Act and tax credits to help working families.