A group of Republican lawmakers are attempting to repeal the Corporate Transparency Act, which requires companies to disclose their true ownership, proclaiming the law “a big government overreach.”
Sen. Tommy Tuberville (R., Ala.) on Wednesday reintroduced the Repealing Big Brother Overreach Act, a bill that aims to repeal the CTA with a stated goal of protecting small-business owners. The bill has so far received support from about 21 Republican senators but no Democrats have yet signed on, according to Tuberville’s office.
“This was poorly written, it was poorly managed, and you can’t hold the American taxpayers hostage on something that the federal government wants to do,” Tuberville said in an interview Tuesday, referring to the original legislation establishing the CTA.
Congressman Warren Davidson (R., Ohio) also reintroduced companion legislation in the U.S. House of Representatives on Wednesday. The bill has 66 Republican co-sponsors in the House.
Davidson said in a statement that the CTA’s disclosure requirements infringe “on American small-business owners’ privacy rights by forcing them to disclose sensitive information to the government,” and are “a disaster for small businesses.”
The Corporate Transparency Act, passed by Congress in 2021, was a bipartisan effort to curtail the use of anonymous shell companies and help track the flow of illicit money. It mandates millions of companies to file beneficial ownership information with the Treasury Department’s Financial Crimes Enforcement Network or face the possibility of penalties such as fines and jail time. The law covers an estimated 32 million small businesses nationwide.
The efforts to repeal the Corporate Transparency Act come at a crucial time for the law, which is also facing legal challenges in federal courts. Supreme Court Justice Samuel Alito is set to rule soon on the national injunction issued by a lower court that paused the implementation of the CTA last month.
The bills introduced Wednesday are the second attempts by the two lawmakers to repeal the CTA. They first introduced bills to repeal the CTA last spring, but the proposed legislation failed to pass their respective committees.
Tuberville said it remains to be seen how the latest bill will advance this time around, but said it is backed by 100 trade groups, including the National Federation of Independent Business, an advocacy group for small businesses. He said the bill was filed in case the Supreme Court doesn’t step in to support the injunction.
“If that doesn’t happen, we’ve still got to be prepared to go forward with what we’re doing to try to protect the American people and anybody that’s a small-business owner to remain confidential in any of the information that they don’t really need to give to the federal government,” he said.
Tuberville said he has heard from small-business owners who said that they weren’t aware or lacked time or resources to comply with the filing requirements. He said at the very least FinCEN needs to increase their publicity campaign and their communication on the requirements.
“The meat of the problem here is the overreach and non-communication from the federal government,” he said.
Scott Greytak, director of advocacy at Transparency International U.S., a Washington-based anticorruption watchdog that supports the CTA, said the CTA received strong congressional support, including from Republicans, as well as from the first Trump administration.
“We have absolutely no reason to think that the Trump administration has changed its strong support of the CTA,” he said.
