Reading Eagle: Business owners say they can't afford tax hikes
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By Mary E. Young
Reading Eagle
Restaurant owner Iggy Ignatios says he will survive by looking for more bargains such as the filet mignon he bought for $4.99 a pound.
Deborah Fuoti, owner of Gourmet Corner in Fairgrounds Farmers Market in Muhlenberg Township, says she's running out of options and could go under.
They are among more than 27 million small business owners in the United States. The National Federation of Independent Business is urging Congress to extend the Bush-era income tax cuts on their behalf before the end of the year.
If the Democratically-controlled Congress doesn't extend the cuts, they will lapse and higher tax rates will kick in at least until the Republicans take over the majority in January.
Small business owners would be forced to pay more in federal income taxes on the profits they pocket, and all workers would see their paychecks shrink.
"It could put me out of business," Fuoti said. "I have a 48 percent increase in my medical insurance. I have a $2,600 deductible. It seems everything goes up.
"I find I have less and less money for myself."
Ignatios, owner of Iggy's Restaurant, also in the market, said doing a lot of the work himself and having just four part-time people on his payroll helps.
"You can't do anything about taxes," he said. "The people who got elected asked for your vote. They get in there and have deaf ears."
The four congressmen who represent Berks County said they plan to do everything they can to ensure that the tax cuts are extended.
They go back into session this week and could have another session after the Thanksgiving break.
"It's too important for stability in the business community," said U.S. Rep. Tim Holden, a Schuylkill County Democrat. "We've got to get this done. I think it will get done."
Before the Nov. 2 election, President Barrack Obama wanted to allow the tax cuts to lapse for individuals earning more than $200,000 per year and couples earning more than $250,000 per year but extend the cuts for low- and middle-income people.
Republicans wanted to extend the cuts for everyone.
U.S. Rep. Joseph R. Pitts, a Chester County Republican, said now Obama is talking about compromising on a two-year extension.
Pitts believes Congress should extend the cuts before the end of the year so people have the confidence to start investing in their businesses again.
"If you want to stimulate job growth, the sooner the better," he said.
Although the length of an extension still is up for debate, there is bipartisan support for moving forward, said U.S. Rep. Jim Gerlach, a Chester County Republican.
He said the one potential problem is Nancy Pelosi, the California Democrat who is losing her powerful position as House speaker.
She is against extending the cuts for high-earners, Gerlach said.
"Does she put a bill on the floor or does she put her feet on the ground and put it on the next Congress?" he asked. "Nobody knows the answer to that."
U.S. Rep. Charles W. Dent, a Lehigh County Republican, said that if the cuts aren't extended during this session, they will be in January.
And the cuts would be retroactive, so no small business owner or worker would see their take-home pay permanently reduced, Dent said.
"I would prefer it to be by the end of the year, but I don't know where the president is going to come down on this," he said. "Nobody can say with any certainty how this is going to play out.
"It's all speculation."
Fuoti, who operates her business with the help of two part-time employees, said she hopes the politicians live up to their word, but is not convinced they will.
"What's going to happen is going to happen," she said. "I don't have any control over it. No matter who you vote for, what's to be is to be."
Contact Mary Young: 610-478-6292 or myoung@readingeagle.com.
