The National Federation of Independent Business announced on Apr. 15 a new report detailing the economic impact and tax savings that the now-permanent 20% Small Business Tax Deduction will bring to Minnesota’s 560,428 small businesses.
The report highlights how making this deduction permanent could help create jobs and boost the state’s economy. According to projections, Minnesota may see an increase of 25,000 new jobs annually over the next decade if the deduction remains in place. The state’s gross domestic product is also expected to rise by $1.4 billion each year for ten years, with annual increases reaching $2.9 billion beyond 2035.
“In Minnesota, our small businesses have used the 20% Small Business Tax Deduction to navigate the challenges of inflation and hiring shortages,” said NFIB Minnesota State Director Jon Boesche. “By making this relief permanent, Congress has empowered small businesses to continue raising wages and expanding benefits for their employees.”
Since its introduction in 2017, the Small Business Tax Deduction has allowed qualifying businesses to deduct up to one-fifth of their income from taxes. This measure was set to expire at the end of 2025 until Congress passed legislation that President Trump signed into law on July 4, 2025, ensuring its permanence.
The National Federation of Independent Business – Minnesota advocates for small business interests in state policy and legislation according to its official website. Boesche has served as state director for NFIB – Minnesota according to its official website. The organization serves business owners across Minnesota according to its official website, influences policy through advocacy against burdensome regulations according to its official website, offers resources and updates on issues such as labor mandates and tax policies according to its official website, and operates as an advocacy group for small businesses according to its official website.
Supporters say that with these changes now signed into law, local entrepreneurs can focus more resources on growing their companies rather than meeting additional tax obligations.
