FOR IMMEDIATE RELEASE 

HARTFORD, CT (April 15, 2025) – The National Federation of Independent Business (NFIB), the nation’s leading small business advocacy organization, released a new report outlining the benefits the 20% Small Business Tax Deduction will bring to Connecticut if made permanent. The report also spotlights that the 365,000+ small businesses in Connecticut could face significantly higher taxes if Congress does not make the 20% Small Business Tax Deduction permanent this year. The report outlines the severe consequences for small businesses in Connecticut and the broader U.S. economy that would result from the provision’s expiration, highlighting potential economic slowdown and increased financial strain on local businesses.

The report also highlights a stark contrast in tax rates between small businesses and their larger corporate competitors if the deduction is not made permanent. In Connecticut, the C-Corp tax rate would remain at 29.25% while the small business rate would surge to 46.59%.

However, making the deduction permanent would lead to significant economic benefits, leaving the small business tax rate on a level playing field with its competitors. Additionally, Connecticut is projected to gain 14,000 new jobs annually over the next 10 years if the deduction remains in place, including an annual GDP increase of $887 million for the first decade and $1.83 billion per year beyond 2035.

View the report for Connecticut here.

“Connecticut small businesses have a lot on their hands with rising costs, burdensome regulations, and workforce shortages,” said NFIB Connecticut State Director Andy Markowski. “If Congress allows the 20% Small Business Deduction to expire, the massive tax hike will exacerbate the struggle many small business owners face. Congress must act quickly to protect our small businesses.”

The 20% Small Business Tax Deduction, a key provision of the Tax Cuts and Jobs Act of 2017, has empowered millions of small business owners to expand, hire employees, and increase wages. If Congress does not act to make it permanent this year, nine out of 10 small businesses will face a significantly higher tax burden, threatening jobs and economic stability nationwide.

For more information about NFIB’s advocacy efforts and to access Connecticut’s report visit: NFIB-20-Small-Business-Deduction-Impact-CT.pdf

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For 80 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is nonprofit, nonpartisan, and member-driven. Since our founding in 1943, NFIB has been exclusively dedicated to small and independent businesses, and remains so today. For more information, please visit nfib.com.