Small business use of generative AI has jumped from 23% in 2023 to 58% today, but the U.S. Chamber of Commerce is warning Congress that a growing patchwork of state AI and privacy laws could raise compliance and litigation costs fast enough to undo the gains.
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What happened
In testimony before the House Energy and Commerce Committee’s commerce, manufacturing, and trade subcommittee on June 30, 2026, Chamber senior vice president for policy Marty Durbin warned that state-by-state AI and privacy obligations create uncertainty for small businesses trying to adopt the technology responsibly.1 The warning draws on the Chamber’s 2025 Empowering Small Business report, which surveyed 3,870 small businesses nationwide.
That survey found 58% of small businesses now self-identify as generative AI users, up from 40% in 2024. Among businesses already using AI, 77% said new limits on the technology would hurt growth, operations, and the bottom line — while 65% of all small businesses surveyed said they were concerned a fragmented regulatory environment would drive up litigation and compliance costs.2 The Chamber is backing H.R. 8413, the SECURE Data Act, which would establish federal preemption over state privacy laws — a move privacy advocates, including the California Privacy Protection Agency, argue would strip away existing consumer protections.
Why it matters
Small businesses are adopting AI tools faster than the rules governing them are settling, and that gap creates real exposure — not just around AI itself, but around the customer, employee, and financial data those tools touch. A business using an AI tool to draft marketing copy in Washington faces a different compliance picture than one using AI to process customer payment data or financial records, and most owners don’t have the bandwidth to track fifty states’ worth of evolving privacy law.
What this means for small business owners
The safest place to start with AI adoption is the back office, where the tools are mature, the data governance is already handled by a vetted platform, and the compliance burden doesn’t fall on the business owner to figure out alone. AI-assisted bookkeeping and financial reporting tools — the kind built specifically for financial data handling — let owners get the productivity benefit the Chamber’s survey is describing without personally becoming the compliance officer for a fragmented regulatory landscape. It’s a lower-risk entry point than rolling out AI across customer-facing operations before the legal picture is clear.
“To get AI policy right, companies must have certainty about how the data used for AI systems is governed,” the Chamber’s testimony stated.
The bottom line
AI adoption among small businesses isn’t slowing down — the Chamber’s own numbers show it more than doubled in two years. What’s still unsettled is the rulebook, and until Congress resolves the state-versus-federal fight, small business owners are better off deploying AI where the governance is already buttoned up, like financial and bookkeeping systems, rather than waiting on regulatory clarity that may not arrive this year.
