Small businesses across the country are watching Capitol Hill closely, hoping lawmakers will deliver another round of relief to address mounting challenges. While Main Street remains optimistic, the nation’s 30 million-plus job creators face a growing list of obstacles—from soaring health costs to burdensome mandates—that have intensified over recent years.
Last year’s reconciliation bill marked a significant win: Congress, working with President Trump, made the 20 percent Small Business Deduction permanent. This move prevented a massive tax hike for over 30 million small businesses at the end of 2025 and gave them a more level playing field against corporate giants. Many firms have since used those savings to raise wages, hire more workers, and sponsor local youth sports teams.
Now, Main Street is pressing for more. The National Federation of Independent Business (NFIB) is urging lawmakers to expand tax relief, cut red tape, and tackle healthcare costs. One key proposal: raising the Small Business Deduction from 20 percent to 23 percent—a measure that nearly passed last year. A deeper deduction would help small firms compete with Wall Street, driving more jobs, higher pay, and greater community investment.
Small businesses structured as C-corporations also need immediate relief. Until the mid-2010s, the first $50,000 of income was taxed at just 15 percent; today, that rate is nearly 40 percent higher. Restoring the lower rate would reward entrepreneurs and fuel growth.
Beyond taxes, regulatory reform is a top priority. The Beneficial Ownership Information reporting mandate, which requires 32.6 million small businesses to register with the federal government under threat of $10,000 fines and two years in prison, remains a flashpoint. President Trump exempted American small businesses from this rule in 2025, saving an estimated $128 billion in compliance costs, according to the White House Office of Management and Budget. But a future administration could reimpose that burden. Congress should permanently repeal the mandate, freeing small businesses to invest in their futures.
Healthcare costs are another critical issue. Only about a third of small businesses offer health coverage, compared to 96 percent of large corporations, and the share has fallen nearly 10 percent since 2010. Lawmakers can help by codifying Trump-era reforms on flexible CHOICE plans and Short-Term, Limited Duration Insurance, as well as enabling Association Health Plans and unrestricted Health Savings Accounts. These changes could give millions of small business employees access to affordable plans.
As the midterm elections approach, President Trump has called on Congress to pass another reconciliation bill. Lawmakers should act quickly, advocates say. With another round of relief, Main Street can thrive—and that success will strengthen the broader economy.
For more on the political dynamics, see how internal GOP tensions could affect the midterm push. Meanwhile, PayPal has launched a $30 million fee waiver for small businesses in a separate but related development. And GOP lawmakers are also pushing housing and gas tax relief as inflation remains a key campaign issue.
