The U.S. Chamber has come out strongly against a tax bill that would saddle small businesses, American worldwide companies, and investment partnerships with draconian tax increases.

The American Jobs and Closing Tax Loopholes Act being considered in the Senate would extend unemployment benefits and renew important expired business tax provisions (such as the research and experimentation tax credit). However, lawmakers are pursuing a laundry list of permanent tax increases purportedly designed to “pay for” the temporary extension of tax provisions the Chamber has long supported. The House passed the bill on May 28, just as lawmakers left for the Memorial Day recess.

“Many of these provisions would make significant changes to long-standing aspects of U.S. tax law and policy and have never been considered in hearings or other bills,” states a June 7 Chamber letter to senators. “Even worse, many of these provisions are retroactive, imposing serious costs and complications on companies seeking to comply with these changes.”

One of the most onerous tax hikes in the bill would impose the Medicare payroll tax on certain individuals and small businesses that form S-Corporations. Under current law, owners of S-corporation service-sector companies—including architectural and accounting firms—don’t pay taxes at the company level; rather, owners pay personal income taxes on the business profits as a shareholder in the company. In its letter, the Chamber notes that the measure would add to the tax code’s complexity by creating new categories of business activity.

The bill would also limit the foreign tax credits U.S. businesses can claim for income taxes paid to other countries. The Chamber argues that such a provision would ‘affect the competitiveness of American worldwide companies,” including small businesses. “This legislation contains numerous changes to longstanding U.S. international tax law which are severely detrimental to the ability of American worldwide companies to compete globally, create jobs, and stimulate economic growth,” the Chamber letter says.

In addition, lawmakers are once again looking to increase the tax on “carried interest”—the share of investment profits that partnership managers are allowed to keep—resulting in “unintended negative consequences for capital formation and innovation in real estate, energy, investment, and other sectors of the economy,” the Chamber argues. “If Congress is seeking to enact policies which spur sustainable job creation and foster market stability, implementing changes to longstanding law that discourage investment and deter economic growth simply is not the answer.”