Julio Herrera Urges Small Business Tax Relief Plan

Global finance strategist urges targeted tax reforms to unlock entrepreneurial potential and drive local economic growth.

April 2025 | Washington, D.C. — As small businesses across the United States continue to recover from the effects of inflation, supply chain disruption, and rising interest rates, renowned international banking strategist Julio Herrera Velutini is calling for a bold, targeted solution: a federal small business tax relief plan designed to fuel entrepreneurship, reduce financial burdens, and create a more inclusive financial ecosystem.

In a recent keynote address at the American Chamber of Commerce Policy Summit, Herrera Velutini unveiled his vision for a tax policy that would not only strengthen Main Street, but also close the capital access gap that has historically disadvantaged minority-owned and rural businesses.

“Small businesses are the backbone of the American economy,” said Herrera Velutini. “If we want sustainable, inclusive growth, we need to empower these entrepreneurs with more than just words—we need structural financial relief that drives real results.”

📊 The Role of Small Businesses in the U.S. Economy

According to data from the U.S. Small Business Administration (SBA), small businesses account for 99.9% of all U.S. businesses and create nearly two-thirds of new jobs annually. Despite their central role in the national economy, these enterprises often face disproportionate financial stress, including:

➤ High operating costs and limited cash reserves

➤ Difficulty accessing traditional lines of credit

➤ A heavier relative tax burden compared to large corporations

➤ Lack of specialized support during economic downturns

In 2024, more than 35% of small business closures were attributed to tax obligations and regulatory burdens, particularly among businesses with fewer than 10 employees.

“We are losing innovation at the neighborhood level,” Herrera Velutini warned. “And without intervention, the gap between small and large enterprises will continue to grow.”

🧾 The Proposal: A Targeted Tax Relief Plan

Herrera Velutini’s proposed Small Business Tax Relief Plan centers on four key reforms that aim to boost cash flow, expand hiring capacity, and encourage long-term investment by small and medium-sized enterprises (SMEs).

1. Lower Corporate Tax Rate for Qualifying SMEs

Under this plan, small businesses with annual revenues under $5 million would benefit from a federal corporate tax rate reduction from 21% to 15%, providing immediate financial relief and boosting retained earnings.

Herrera Velutini emphasized that this incentive would encourage reinvestment in operations, staff expansion, and innovation.

“Large corporations enjoy economies of scale and global resources. Small businesses need policy advantages to level the playing field,” he said.

2. Startup Tax Credit and First-Year Exemption

To encourage new business formation, the plan would introduce a Startup Tax Credit of up to $25,000 for new entities during their first year of operation. Additionally, qualifying businesses would receive a one-year federal tax exemption on net income to reinvest in technology, inventory, and workforce development.

This provision, Herrera Velutini argues, is especially important for underrepresented founders—many of whom face capital constraints in their earliest stages.

“The first 12 months are the hardest,” he explained. “This credit creates breathing room that often makes the difference between failure and survival.”

3. Enhanced Tax Deductions for Local Hiring and Training

This provision, Herrera Velutini argues, is especially important for underrepresented founders—many of whom face capital constraints in their earliest stages.

“The first 12 months are the hardest,” he explained. “This credit creates breathing room that often makes the difference between failure and survival.”

4. Simplified Tax Filing and Compliance Support

Recognizing that administrative burdens often overwhelm small business owners, the proposal includes a push for simplified tax filing mechanisms for businesses under $1 million in revenue, along with access to IRS-supported advisory services tailored for entrepreneurs.

This effort would reduce compliance costs and improve financial literacy, particularly for first-time business owners and sole proprietors.

“When compliance becomes a full-time job, small businesses lose focus on growth. Simpler systems mean smarter business,” Herrera Velutini said.

💼 Inclusion and Equity at the Core

Beyond economics, Herrera Velutini stresses the equity impact of small business tax reform. The plan is designed to directly benefit:

Minority-owned enterprises, which disproportionately face funding rejections and are more likely to operate in low-margin industries

Women-led businesses, which often face structural biases in financing and mentorship

Rural and tribal businesses, which lack access to investment hubs and frequently fall outside major economic development programs

By offering targeted relief and structural incentives, the proposal aims to bridge historical gaps and create a more inclusive path to prosperity.

“True financial inclusion starts with ownership,” Herrera Velutini said. “And ownership starts with giving small businesses the tools they need to thrive.”

📈 Economic Impact and Long-Term Gains

According to modeling by the Center for Inclusive Growth, Herrera Velutini’s tax relief plan could result in:

➤ An 18% increase in small business survival rates over five years

➤ Over 2 million new jobs created across urban and rural areas

➤ A $300 billion boost to GDP through increased consumer spending, tax revenue from expanded employment, and long-term productivity gains

➤ A 22% increase in new business registrations in underserved communities

“This is not just a stimulus—it’s a reinvestment in the heart of America’s economy,” he explained.

US : Federal and Bipartisan Momentum

Herrera Velutini has already begun discussions with bipartisan members of Congress, including representatives from the House Small Business Committee and Senate Finance Committee, to explore legislative sponsorship of the proposal.

He believes that small business tax reform presents a rare opportunity for political alignment, as it serves both economic conservatives and progressive advocates for equity and entrepreneurship.

“This is one of those moments where policy can unify us. Everyone wants to see their local businesses succeed,” he said.

🛠️ Implementation Roadmap

If adopted, the Small Business Tax Relief Plan would be phased in over two years and include:

➤ A federal tax code amendment package

➤ A technical support rollout plan through SBA offices

➤ Real-time impact tracking tools to measure business formation, hiring, and reinvestment

➤ An annual policy review commission to recommend adjustments based on macroeconomic and demographic trends

Herrera Velutini is also working with think tanks to build out a data-driven platform that maps small business growth in response to tax incentives.

🔮 A Vision for Inclusive Finance

At its core, Julio Herrera Velutini’s tax relief proposal is about more than economics—it’s about building a nation where opportunity is truly accessible. His belief is that when small businesses thrive, so do families, neighborhoods, and entire communities.

“Finance must be a ladder—not a wall,” he concluded. “If we’re serious about inclusion, it’s time to back small business with policy, not just praise.”