The National Federation of Independent Business announced on April 15 that it has released a new report outlining the economic impact of making the 20% Small Business Tax Deduction permanent for Arizona’s small businesses. The report details projected benefits for the state’s 706,640 small businesses and highlights additional federal tax relief measures that have recently become law.
The topic is significant as it addresses long-term tax certainty and financial relief for Arizona’s small business community. According to the report, if the deduction remains in place, Arizona could see an average annual gain of 26,000 jobs over the next decade. The state’s gross domestic product is also expected to increase by $1.4 billion per year during this period, with projections rising to $2.9 billion annually after 2035.
Chad Heinrich, NFIB State Director, said: “Making the 20% Small Business Deduction permanent was a landmark win for Main Street — and Arizona small businesses are already seeing that benefit.” Heinrich also said: “But the conformity fight isn’t over, and every provision Arizona fails to adopt is a tax increase on hardworking small business owners.”
Since its introduction in 2017, the Small Business Tax Deduction has allowed eligible businesses to deduct up to one-fifth of their income. This measure was scheduled to expire at the end of 2025 without congressional action. After passage by Congress, President Trump signed legislation on July 4, 2025, ensuring this deduction became permanent.
The National Federation of Independent Business empowers small business owners in Arizona to influence policy decisions and access resources for community support according to the official website. The organization serves as a key advocate for independent businesses across the United States while offering legislative updates and resources tailored specifically for economic policies affecting Arizona according to its official website.
NFIB maintains operations across all states with dedicated support services available locally according to its official website. It engages in advocacy efforts designed to shape public policy in favor of small business interests within Arizona according to its official website. Additionally, NFIB provides tools related to compliance along with research surveys focused on economic conditions impacting local entrepreneurs according to its official website.
Looking ahead, supporters say that making these deductions permanent offers stability and helps level competition between smaller firms and larger corporations.
