By guest columnist MELINDA SYLVESTRE, President of the Greater Georgia Black Chamber of Commerce
Across the 50 states, there are 2.6 million black-owned businesses that generate over $ 138 billion in revenue per year. Georgia is among the leaders in the country as black entrepreneurs and black businesses flock to our state to start new businesses to create jobs and wealth.
There are more than 8,900 black-owned businesses employing 83,000 workers in Georgia, according to Zippi, a national employment and career site. This makes our state the second in the country for black-owned businesses.
Most business owners started out because someone took a risk and invested capital because they had a good idea – from building car washes to starting a series of hair salons or apartment complexes or barbecue restaurants. These risk takers should be honored as heroes in their local community, helping to foster prosperity, as they are the backbone of our country’s economy.
Sadly, just as our economy begins to rebound from the COVID-19 pandemic, some members of Congress are imposing a misguided business investment tax that will make it harder for black-owned businesses to receive the essential private investments needed to launch. or grow their business – and be successful in the times to come.
Known as deferred interest, Congress seeks to eliminate a provision that investors should pay taxes on their investment immediately rather than after a project begins to generate a profit. In many cases, it can take years for an investment to pay off and pay off.
The House Ways & Means Committee recently included this destructive tax hike in a proposal for the upcoming $ 3.5 trillion spending plan. âThe Biden administration has marketed this proposal as an ‘investment in our economic future’, but it would hurt the black-owned businesses they claim to be helping,â said Larry Ivory, president of the National Black Chamber.
Despite the many difficulties already faced by black business owners during the pandemic, private investment has been a promising new source of growth for the African American community. In fact, in the first half of 2021 alone, black business owners secured nearly $ 1.8 billion in investment funding nationwide, a 450% increase over the same period. last year and nearly double the total investments made in black entrepreneurs in 2020.
Now is not the time to impose restrictive tax hikes on one of the most promising growth avenues for black entrepreneurs.
That being said, the economic devastation that the COVID-19 pandemic continues to have on businesses across America is far from over. The pandemic has taken its toll on businesses of all sizes in all 50 states, but African-American-owned businesses have been disproportionately affected more than any other racial group.
In fact, 58% of black-owned businesses said they were in financial difficulty due to the COVID-19 pandemic. From February to April 2020, the ownership of black companies fell by 41%. And although the total unemployment rate in the United States fell to 5.4 percent in July of this year, it has remained at 8.2 percent for black workers. Which begs the question, why would Congress put in place a tax to hurt black-owned businesses?
Nor does all of this mean that African-American businesses would be the only ones affected by this proposal. More than 14,000 businesses across America that employ nearly 12 million workers depend on similar investments to hire workers, grow, or just keep the doors open.
At the Greater Georgia Black Chamber of Commerce, we are committed to empowering and economically supporting African American communities through entrepreneurship and capitalism. The success and well-being of our nation’s black-owned small businesses is critical to the overall health of our national economy.
America’s black small business community is robust and strong, but we urge Congress to oppose all efforts to include this misguided business investment tax in the next $ 3.5 trillion budget proposal. .
Note to readers: The Greater Georgia Black Chamber of Commerce was formed in 2015 and supports black-owned businesses in all 159 counties of Georgia.