Small Business Files Brief Challenging Onerous Government Mandates

Date: April 16, 2021

NFIB Files Brief That Would Provide Vital Small Business Tax Relief

The National Federation of Independent Business, or NFIB Legal Center, filed an amicus brief in the Eastern District Court of Missouri supporting Missouri in its challenge to the provision of the American Rescue Plan Act of 2021 that would prevent states from using federal funds for state tax relief for Missouri small business owners.

“Small businesses are still struggling to rebound from the COVID-19 pandemic and need as much financial relief as possible,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “Congress passed the American Rescue Plan to relieve some of the financial pressure caused by the pandemic, but a provision that blocks Missouri and other states from cutting taxes is eroding state sovereignty and hurts local businesses.”

Earlier this month, Eric Schmitt, Missouri’s Attorney General, initiated a lawsuit questioning Treasury Secretary Janet Yellen over part of the $1.9 trillion American Rescue Plan (ARP) Act that prevents states from using the funds they receive from the law to offset tax cuts.

“Small business owners across Missouri have been hard hit by the COVID-19 pandemic,” said Brad Jones, NFIB State Director in Missouri. “They should be able to take advantage of tax cuts that Missouri lawmakers are considering right now. High taxes are a major concern for our small business owners. The ARP Act jeopardizes Missouri lawmakers from passing important COVID-19 tax relief for our struggling small business owners who are trying their best to keep Missourians employed and the economy running.”

The American Rescue Plan Act of 2021 made funds available to states if and only if states agree to not pass any laws or take any administrative actions that decrease their net revenue, whether that decrease comes through tax credits, rebates, reductions in tax credits, or new or expanded deductions. NFIB believes the court should block this unprecedented tax mandate and grant the states’ motion for a preliminary injunction.

The NFIB Small Business Legal Center protects the rights of small business owners in the nation’s courts. NFIB is currently active in more than 40 cases in federal and state courts across the country and in the U.S. Supreme Court.

Related Content: News | CoronaVirus State | Missouri

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