NFIB Study: Small Business Introduction to the Tax Cuts and Jobs Act
NFIB’s Research Center randomly sampled 20,000 NFIB members between February and April 2018 and asked about the Tax Cuts and Jobs Act. Here’s how small business owners responded about the new law.
- Over three-quarters (76 percent) of small business owners believe the current business climate is heading in a positive direction.
- The vast majority (87 percent) percent of small business owners think the new tax law will have a positive impact on the general economy. Just 4 percent believe it will have a negative impact and 9 percent think it will have no significant impact.
- Three-fourths (75 percent) of small business owners believe the tax law will positively impact their business, 22 percent anticipate it will have no impact, and 3 percent a negative impact.
- While small business owners are enthusiastic about the law generally, many of the details are still unfamiliar to them. Almost one in four (24 percent) small business owners are not at all familiar with the new tax law.
- Half of small business owners with some familiarity about the law obtained their most useful information from their tax preparer or advisor, another 28 percent from the general news media.
- Over half (51 percent) of small business owners expect to pay less in federal income taxes next year, 7 percent expect to pay more, and 37 percent about the same.
- Almost half (47 percent) of small business owners who expect to pay less in taxes next year plan to increase business investments with their tax saving and 44 percent plan to increase employee compensation. Another 40 percent of small business owners plan to pay down debt obligations, 32 percent plan to retain the funds freed up as higher earnings available to support business growth, and 27 percent plan to hire an additional employee.
- Over half (55 percent) say that the creation of Section 199A, allowing for up to a 20 percent small business income tax deduction, is “very important” with another 29 percent “somewhat important”.
- Forty-five percent of small business owners say that changes to the personal income tax brackets and rates are “very important” to them and their business, 40 percent say “somewhat important”.