Small Businesses Files Brief Against American Rescue Plan Tax Mandate

Date: March 11, 2022

NFIB files amicus brief at Sixth Circuit Court of Appeals

CINCINNATI, Ohio. (March 11, 2022) – The National Federation of Independent Business (NFIB) filed an amicus brief in the case Kentucky v. Yellen at the United States Sixth Circuit Court of Appeals. The brief supports Kentucky and Tennessee’s challenge to a provision of the American Rescue Plan Act, which prevents states from directly or indirectly providing much-needed tax relief. NFIB filed the amicus brief with the U.S. Chamber of Commerce.

“The small business community is still experiencing negative effects from the COVID-19 pandemic and the various regulations and restrictions,” said Karen Harned, Executive Director of NFIB’s Small Business Legal Center. “Some states have tried to ease the tax burdens on small businesses, but the American Rescue Plan currently prevents states from cutting taxes. At a time when small businesses need financial relief, this provision hurts the small business recovery.”

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 and expanded deductions. NFIB argues the tax mandate is unprecedented and unconstitutional and urges the court to affirm the district court’s permanent 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.

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