Research Report Small Business, Innovation, and Tax Policy: A Review
Samuel Brown, William G. Gale
Display Date
Download Report
(272.68 KB)

Small businesses occupy an iconic place in American public policy debates. This paper discusses interactions between the federal tax code, small business, and the economy. We summarize the characteristics of small businesses, identify the tax provisions that most affect small businesses, and review evidence on the impact of tax and other policies on entrepreneurial activity. We also examine evidence suggesting that it is young firms, not small ones, where job growth and innovation tend to occur. Policies that aim to stimulate young and innovative firms are likely to prove different than policies that subsidize small businesses.
Research Areas Taxes and budgets
Tags Taxes and business Federal budget and economy Community and economic development Small businesses