Letters to Washington
| September 12, 2023

Coalition Letter to House Committee on Financial Services on the Protecting Small Business Information Act of 2023 (H.R. 4035)

The undersigned organizations, representing millions of small businesses operating in every community across the country, write in strong support of the Protecting Small Business Information Act of 2023 (H.R. 4035). By delaying the Corporate Transparency Act’s (CTA) reporting requirements from taking effect until a robust regulatory framework is put into place, your legislation will help ensure affected businesses are not subjected to an overly burdensome and unpredictable compliance regime. The CTA was enacted in 2020 with the stated goal of combatting money laundering, terrorist financing, and other illicit activities. The statute requires the submission of regular reports to the federal government that include a litany of sensitive personal identifiers of the owners and senior employees and/or advisors of covered entities. The first challenge is the CTA applies only to businesses with under $5 million in annual revenues and fewer than 20 employees, thus ensuring that the very companies who can least afford the costs associated with compliance are the ones being targeted. The Treasury Department estimates the CTA will cover over 32 million existing entities and an additional 5 million newly-created entities every year. These companies and other legal entities will be subjected to increased paperwork, privacy risks, and potentially devastating fines and prison terms.