McCaul, Roy introduce bill to protect small businesses from costly regulations

May 13, 2021
Press Release


WASHINGTON, D.C. – Today, Texas Congressmen Michael McCaul (TX-10) and Chip Roy (TX-21) reintroduced the successful One In, Two Out Act, which would require any federal agency issuing a new regulation to repeal two existing regulations before the new one takes effect. 

Small businesses make up 99.7 percent of U.S. employer firms. A 2016 study conducted by the Chamber of Commerce found that small businesses pay $11,700 per year per employee in regulatory costs. Further, the study found small businesses with 50 employees or less pay nearly 20 percent higher costs than an average firm. In total, small businesses were project to pay nearly $40 billion per year.

In 2017, the Trump Administration issued an executive order to cut out these burdensome regulations. By 2019, the EO saved small businesses $733 million in regulation costs. However, the Biden Administration’s decision to rescind the One In, Two Out Policy on his first day in office hurts already struggling businesses in the wake of the COVID-19 pandemic.   

“In a time when small businesses are still rebuilding from the COVID-19 pandemic, we should not reinstate onerous regulations that will place heavy penalties on American business owners,” said McCaul. “Regulations can be complex for small businesses to navigate and come at a high cost. That is why I am proud to reintroduce the One In, Two Out Act, which will force regulators to make tough choices when considering new regulatory burdens on businesses."

“The best thing the government can do for small businesses is get out of their way and let them thrive,” said Roy. “President Trump and his Administration took tremendous strides to slash burdensome regulations that were harmful to our economy, saving hundreds of millions of dollars in regulation costs and creating countless jobs. I am proud to cosponsor my friend, Congressman McCaul’s One In, Two Out Act to reinstate President Trump’s effective red tape cutting rule at a time when the Biden Administration is ignoring the challenges facing small businesses from the pandemic and tyrannical lockdown measures.”


Modeled after the successful British policy, the One In, Two Out Act requires government departments to assess the net cost to business of complying with any new regulation that is proposed (an “in”). For major regulations with an annual economic cost of more than $100 million, a deregulatory measure (an “out”) must be found that reduces the net cost by at least the same amount before the new regulation may go into effect. When this policy was enacted in the United Kingdom in 2013, departments proposed a total of 157 domestic regulatory measures, 119 of which would have imposed a burden on business. After just six months, only 46 regulations remained, and only 11 of those imposed a net cost to business.