Straight Talk: Tax Truth

House Committee on Small Business, Republicans

Weekly Update from Sam

Dear Friends,

Tax rates affect behavior. If small businesses with tight budgets in a slow economy face higher taxes, they will be forced into making hard choices. Many of those decisions will affect jobs; in turn, that affects families. The decision should be clear: don’t raise taxes on small businesses right now. The tax and regulatory burden is already asking too much of job creators.

An Ernst & Young study released this week by NFIB ran the numbers. They found that President Obama’s proposed tax hike on 900,000 small businesses would cost 710,000 jobs. That hurts. Unemployment has been at least eight percent for 41 straight months. Any tax hike would be a new roadblock to the economic recovery we need, especially when those tax hikes are directly on the job creators.

The federal government should not expect small businesses to plan for next year without knowing what rate they will pay in taxes. Yet it’s already late July, and they still don’t know. That uncertainty is counterproductive to the businesses they’ve built and the jobs they’ve created.

Our Committee hearing on Wednesday with FCC Commissioner Genachowski regarding broadband deployment brought this need for stability into focus yet again. We pressed three federal agencies to bring broadband access to small businesses across rural America, by providing more regulatory predictability and stability for broadband carriers.

This week, the President showed again that he doesn’t respect your ability to start and grow a company. Be assured we know who builds businesses, and the hard work it takes to succeed as an entrepreneur.

(signed)
Sam Graves
Chairman

Latest Committee Action

On Wednesday, the Committee held a hearing appraising the role of the federal government in expanding broadband access to small businesses across the country. The Committee conveyed to three federal agencies, including FCC Chairman Julius Genachowski, the need to bring more access and certainty to rural and unserved areas. The Internet is an important tool for small businesses, giving access to the global electronic marketplace. That helps them compete. First, they need reliable broadband access to grow and create jobs. The Committee has heard from a number of carriers that regulatory uncertainty can hinder deployment of broadband to new areas.

On Thursday, the Small Business Subcommittee on Investigations, Oversight and Regulations, held a hearing on the reasons for a trend in the health care industry that is seeing more doctors leave small practices to join larger medical practices or hospitals, due to expenses associated with increased regulation, medical malpractice insurance and health IT implementation, among other factors. The burdensome new health care law is being implemented against that backdrop. The Committee heard concerns about the increase of statutory and regulatory requirements, which can further escalate costs. A decrease in small practices can mean less access to affordable care, especially in rural regions, and a diminished doctor-patient relationship.

Small Business Feedback

We want to hear from you about specific federal regulations that are burdening your business. According to an SBA study, small firms bear a regulatory cost that is 36 percent higher than the cost of regulatory compliance for large businesses. Go to our interactive website, Small Biz Open Mic, to let us know what federal regulations are holding your small business back from growing or hiring. Finally, know the tax ramifications of the approaching fiscal cliff.

News From Washington

On Wednesday, the House of Representatives voted 414-2 for a Sequestration Transparency Bill, requiring the White House to provide detailed information on how it would carry out the planned across-the-board spending cuts known as sequestration beginning in early 2013. The American people deserve to know his plan for implementing the $110 billion in across-the-board cuts scheduled for Jan. 2.

On Thursday, the House passed the Department of Defense Appropriations Act, the yearly legislation financing our nation’s military. The legislation includes funding for critical national security needs, and continues the nation’s military efforts abroad. It provides essential funding for health and quality of life programs for the men and women of the Armed Services and their families.

July 20, 2012