Straight Talk: Small Businesses Are Getting a Bad Deal

An old (amusing but grim) observation attributed to Benjamin Franklin is that the only things certain are death and taxes. How ironic – with January barely over three months away – that Americans are still not certain what their tax rates will be by then. The House has voted to stop tax increases and provide certainty. President Obama and the Senate are defaulting on this duty.

We don’t look to the federal government to create private sector jobs, but rather to create an environment that fosters growth. Conversely, the government can stifle growth through bad decisions like this uncertain tax environment. As the nation slogs through the worst recovery since the Great Depression, there can be little doubt that President Obama’s unreasonable policies are playing a role in preventing robust recovery.

Uncertainty is paralyzing for small businesses, many of which operate on razor thin margins. The United States needs tax reform because small businesses should never be put in this fix again. The complicated tax code has become bulky and too prone to picking winners and losers in our economy. The first step toward fiscal soundness is stopping the threat of tax hikes on small businesses. The Senate and the President should put aside their tactics of division and end this costly and needless uncertainty.

Latest Committee Action

On Thursday, the Committee examined how the President’s default “plan” to deeply cut national defense and other programs, known as sequestration, will devastate many small businesses. Expert witnesses, citing this study, testified that 956,000 small business jobs will likely be lost, among 2.14 million jobs at risk. The House is working to prevent these chaotic, indiscriminate cuts to national security. 

Back on May 10, 2012, the House passed the Sequester Replacement Reconciliation Act of 2012 (HR 5652) to replace these cuts with responsible spending reductions spread throughout other federal programs. Rep. Allen West of the Small Business Committee sponsored the National Security and Job Protection Act (HR 6365), which the House passed Sept. 13, 2012, to require President Obama to submit a plan to Congress by October 15, 2012 to prevent these harmful cuts and implement thoughtful reductions. The Senate has not voted on either of these bills.