FIRST ON FOX: A group of House Republicans whose districts include parts of rural America are criticizing President Biden’s fiscal 2025 budget proposal for elements they argue will levy more economic strain on American farmers and family-owned businesses.
Rep. Randy Feenstra, R-Iowa, led more than a dozen Republicans in a letter directly to Biden, calling out his budget for including increases to capital gains taxes, the penalties that are paid by investors or owners when they sell an asset, based on the value accumulated over time.
"We write today on behalf of Americans across this nation that own and operate small businesses and family farms, and the employees and customers they serve. Since the founding of this nation, America’s farmers and small businesses have been the backbone of our economy. Unfortunately, revenue proposals outlined in your FY2025 Budget Request will significantly burden these hardworking Americans," the Republican lawmakers said.
They called out Biden for issues related to the proposed capital gains tax, writing, "Small business owners who want to pass on their businesses to their children would be exposed to devastating new tax increases in capital gains taxes, a new transfer tax on appreciated assets passed upon death, and restricting like-kind exchanges, amongst other tax increases, that threaten their continued operation."
Among the provisions the lawmakers mentioned in Biden’s budget is closing the "like-kind exchange" loophole, which allows owners and investors of real estate to defer paying capital gains tax.
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"For the agricultural community, a cap on like-kind exchanges would limit farmers’ ability to combine acreage, purchase more productive land, or mitigate environmental impacts, all of which help improve their operations and strengthen the nation’s food supply," the letter reads.
"Further, capping like-kind exchanges could make it more difficult to restructure businesses so that young or beginning farmers can join operations. Such a limit could end up preventing retiring farmers from using like-kind exchanges to exchange their farm or ranch for other real estate, allowing for the next generation to take over without being forced to sell off assets to pay a huge tax bill to Washington."
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They argued that Biden’s budget would harm both the U.S. farming industry and the rural communities that rely on it.
"We urge you not to damage the livelihoods of farmers and small businesses everywhere," the letter reads. "Instead, we look forward to working with you to keep the American economy working for the American people. We are committed to supporting small business owners and the millions of small family farms around the nation as they work hard to make a living."
The White House did not respond to Fox Business' request for comment.
