Trump's SBA wants to reclassify billion-dollar corporations as 'small businesses,' opening door to federal contracts

The Trump administration is proposing a significant change to the Small Business Administration's (SBA) classification of businesses as "small," potentially expanding the definition to include billion-dollar publicly-traded corporations. The SBA formally proposed this rule change on August 20, aiming to include roughly 114,000 additional businesses in the "small business" category following a public comment period ending on September 21.

If passed, the new revenue limit for a business to be considered small would rise from $47 million to $867 million for investment banking companies. Similarly, the limit for firms dealing with fiduciary activities would increase to just over $1 billion. The SBA argues that this change would provide the federal government with access to a larger pool of businesses for awarding contracts and providing financial assistance.

However, some small business groups and a Democratic senator have criticized the proposal, arguing it could diminish opportunities for truly small businesses and make it easier for larger companies to compete for government contracts.