| Weekly Update from Sam |
Dear Friends,
The election is over, and we’re back to work with a full agenda. Small businesses have a lot riding on the decisions that the President and the Congress will make over the next few weeks. While this stretch through January is termed a “lame duck” session, because Members who aren’t returning next Congress are voting on legislation, it is exceptionally important to our nation’s fiscal health. We must come together to avert the fiscal cliff – expiring tax rates and across-the-board spending cuts – and we’re optimistic sensible alternatives can be found before changes take effect on January 1, 2013. If you’re curious about what expiring tax provisions may impact your business, take a look at this page on our website.
We’re particularly concerned about the impact of the President’s proposed tax rate hikes on small businesses and job creation. Small business hiring has already slowed to a crawl under the threat of potential tax hikes, so the prospect of actual tax hikes is a serious matter. One of our primary goals at the Small Business Committee is to advocate for tax relief for small businesses. That includes preventing damaging tax rate increases and identifying targeted spending reductions. Against the backdrop of massive debt and yearly trillion-dollar deficits, we believe spending must be brought under control. A balanced solution would include entitlement and tax reforms. The nation needs real solutions that get beyond entrenched rhetoric to help the economy. We’ll keep you informed and keep looking out for America’s small businesses.
Sam Graves
Chairman
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How Americans See the Fiscal Cliff
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| A Gallup survey released Thursday showed that a clear majority of Americans want fiscal cliff solutions that line up with the House Republicans’ priorities. Most (70%) favor simplifying the tax code with lower rates and fewer loopholes, and support spending cuts (72%). By contrast, less than half (47%) want to raise taxes – the centerpiece of the President’s proposal. An overwhelming majority (95%) agree that we need to get the economy and job creation moving again – but policies of tax increases, more regulations and high health care costs are all creating economic caution instead of growth. |
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News from Washington
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| The House passed legislation upgrading trade relations with Russia, while strengthening human rights. The bill, H.R. 6156, provides for permanent normal trade relations status that supports U.S. exporters and strengthens both nation’s economies, but stipulates that Russia abide by the rules of the World Trade Organization and empowers sanctions for human rights violations.
On Wednesday, Chairman Graves urged the President to include small business leaders in discussions about the fiscal cliff. While the President sat down with major corporate executives for input, small businesses were overlooked. Here at the Committee, we know small businesses cannot afford a big hit on tax rates, and that a one-size-fits-all approach for major corporations will not work for them, since the vast majority of small firms file as individuals. Studies show that the President’s proposal would increase taxes on 53 percent of pass-through business income and more than 900,000 small businesses.
Also, the House of Representatives is in the process of electing leaders for the 113th Congress. Republicans elected their leadership team this week: Speaker John Boehner of Ohio, Majority Leader Eric Cantor of Virginia, Majority Whip Kevin McCarthy of California and Conference Chairwoman Cathy McMorris Rodgers of Washington.
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Stay Plugged In
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Be sure to check out the House Small Business Committee on Facebook, YouTube and Twitter for all the latest in Small Biz news and resources and to join the conversation. We value your input, so send us a message about barriers for your small business on our interactive website Small Biz Open Mic.
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| In Their Own Words |
Small business owners all over America are giving us their insight through our interactive online forum, Small Biz Open Mic. Here's what they're saying:
...we have 10 employees, I’m taxed on income the company earns even though I don’t actually realize any of that money. I drive a seven year old truck and live in a 50 year old house. We do service work which means we pay one of the highest rates on workers compensation on top of California’s anti business fees etc and now I’m going to be rich? I like being my own boss but I could make more working for a big company. This might force me to do just that and will put 10 others out of work in the process. The fact that most of our politicians have never had a real job is why this is happening.”
Sean Edwards (Bakersfield, CA) Engineered Air Inc.
“I started a business about 3 years ago manufacturing and commercializing products for coating petri dishes for researchers doing cell culture experiments. We have grown our product line to 50 products. Our business has grown 30% per year and is profitable, employing 3 employees. There is a significant opportunity to grow business and I would like to expand the business further. However, due to the uncertainties with the new health care law, questions about the Obama Administration's wanting to 'spread the wealth' via taxation and the question about sequestation (cutting funds for medical research), I have decided to allow only modest growth of the company – keeping it small to avoid the ramifications of high taxes and requirements for corporate health care.”
David Bagley (Poway, CA) Advanced BioMatrix
“Our small Sub S corporation had been growing at an impressive rate. We have been approved for a loan to buy our own office space in the Wash DC area. But with the expiration of tax cuts and sequestration facing us, I can't bet that it is a good idea to take on this debt even though we really need our own office space. The business condo real estate market is completely flat so it is a good time to buy. The SBA program is a big help. But the overall economic outlook is a huge concern for me as a CEO. The compromise reached in 2011 for the FY 2012 Federal budget was undermined by this sequestration delay until March 2013. These budget uncertainty issues are causing us to fear problems with awards of contracts for which we have submitted proposals. We are a Healthcare IT firm with a lot to contribute to the future of the quality of healthcare and patient safety. We as a company need to move ahead to help save lives and take care of our Vets. Tax increases would hit us at a very inopportune time of what should have been planned growth and hiring. We aren't IBM, in order to hire someone we have to be able to bill them out to new clients. Please help Sub S's!”
J. Mulrooney (Clifton, VA) J P Systems, Inc.
“More taxation will prove to [be] crippling. As a small business owner we have more than enough rules and regulations to contend with. Our government says all the right things regarding available lending opportunities, less taxation and the intentions of streamlining rules and regs. We feel and see the direct opposite. The price small business owners pay to be independent and provide American jobs is already staggering. We are offered no incentives as promised. Where do we go from here?”
Bill Shaishnikoff (Unalaska, AK) Bering Shai Rock & Gravel LLC
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| November 16, 2012 |
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| What We're Reading |
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Small Biz Resources
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| Tweet of the Week |
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Rep. Kevin McCarthy:
@GOPWhip Outgoing IRS commissioner: “It would serve the American people better to have a tax code that has more certainty" http://kom.io/TH5iM6 (Retweeted by @SmallBizGOP)
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