Mr. President, this week we are celebrating National Small Business Week to recognize the contributions made by small businesses, which are the engine of our economic growth. During 2005, more than 25 billion small businesses in the United States contributed $918 billion to the economy.

Many of our most successful corporations started as small businesses, including AOL, Apple Computer, Compac Computer, Datastream, Evergreen Solar, Intel Corporations, and Sun Microsystems. As you can see from this partial list, many of these companies played an integral role in making the Internet a reality.

Today, Senator Snowe and I are introducing the Invest in Small Business Act of 2007, to encourage private investment in small businesses by making changes to the existing partial exclusion for gain from certain small business stock.

We are at an integral juncture in developing technology to address global climate change. I believe that small business will repeat the role it played at the vanguard of the computer revolution by leading the Nation in developing the technologies to substantially reduce carbon emissions. Small businesses already are at the forefront of these industries, and we need to do everything we can to encourage investment in small businesses.

Back in 1993, I worked with Senator Bumpers to provide a partial exclusion for gain from the sale of small business stock. This provision would provide a 50 percent exclusion for gain for individuals from the sale of certain small business stock that is held for five years. Since the enactment of this provision, the capital gains rate has been lowered twice without any changes to the exclusion. Due to the lower capital rates, this provision no longer provides a strong incentive for investment in small businesses.

The Invest in Small Business Act makes several changes to the existing provision. This legislation increases the exclusion amount from 50 percent to 75 percent and decreases the holding period from five years to four years. This bill would allow corporations to benefit from the provision as long as they own less than 25 percent of the small business corporation stock.

Currently, the exclusion is treated as a preference item for calculating the alternative minimum tax (AMT). The Invest in Small Business Act of 2007 would repeal the exclusion as an AMT preference item. Under current law, the non-excluded amount of gain is taxed at 28 percent. This legislation would tax the non-excluded portion at the lower capital gains rate of 15 or 5 percent.

The Invest in Small Business Act of 2007 will provide an effective tax rate of 3.75 percent for the gain from the sale of certain small businesses. This lower capital gains rate will encourage investment in small businesses. In addition, the changes made by the Invest in Small Business Act of 2007 will make more taxpayers eligible for this provision.

As we celebrate the success of entrepreneurs this week, it is an appropriate time to encourage new investment. The Invest in Small Business Act of 2007 strengthens an existing tax incentive to provide an appropriate incentive to encourage innovation and entrepreneurship.

I ask unanimous consent that the text of the bill and a summary of the bill be printed in the Record.