GALVESTON — Rep. Joe Donnelly told a group of local farmers Friday that the $1.3 billion included in Small Business Tax Relief legislation would help small businesses and family farmers remain profitable.

Donnelly, a Democrat, explained the legislation has already been approved by the U.S. House and is headed to a conference committee because of differences with the version approved by the U.S. Senate.

The bill will increase to $125,000 the deduction small businesses can take from their taxes, a jump of $13,000. It will also increase the number of businesses that will be eligible.

“Capital costs, such as new equipment, can pose real obstacles to family farmers trying to maintain a successful business,” Donnelly said. “This legislation would make it easier for Hoosier farmers to invest in new equipment and even livestock.”

Donnelly said the provisions of the legislation covered all small businesses and not just family farms.

“The tax breaks help with the cost of operating,” he said. “It covers a broad spectrum. The small business owner will be helped the same as the farmer.”

Donnelly said tax relief for small businesses and family farms was not a partisan issue. It’s needed, he said, to ensure that future generations keep the family businesses operating and profitable.

Donnelly said the tax relief for small businesses and family farms was designed to offset any increases in the federal minimum wage.

“This is to make sure that the minimum wage hike will not have an impact on small businesses,” he said. “It gives them an extra boost to remain profitable.”

The bill also provides work tax credits for small businesses and family farmers to hire disabled veterans.

“We were able to combine tax relief and to help disabled veterans find employment in the same bill,” Donnelly said. “When you talk about veterans, it is a commitment that is the top priority.”

One of the key aspects of the legislation, he said, is that the $1.3 billion in tax relief won’t increase the federal deficit.

“We removed some projects from the federal budget like the bridges to nowhere,” Donnelly said.

He hopes that the amount of tax relief will be increased from $1.3 billion in the final version of the bill, but he assured local farmers it would not be cut.

The tax relief built into the legislation will remain in effect for 10 years.

“Small businesses and family farms are the backbone of our communities and the engine of our economy,” Donnelly said. “It’s critical that we provide our entrepreneurs the necessary support they need to invest in the equipment, technology and manpower to stay competitive in today’s global economy.”

Ken de la Bastide can be reached at (765) 454 -8580 or via e-mail at ken.delabastide@kokomotribune.com
Published: February 23, 2007 11:31 pm