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Commentary: Legislation Provides Needed Tax Breaks, Funding For Small Business (Capital Business)
Click here to read this article on the Washington Post site.
Last week, President Obama proposed to spur job growth in small businesses through an extension of a tax credit used when they spend money on research and innovation in the United States. While this is a step in the right direction, it will do little to help our constituents -- the self-employed.
Government policy often favors the larger small business, regarding the self-employed merely as people working on their hobbies at home in their pajamas and bunny slippers. But in reality, the self-employed represent 78 percent of small businesses and contribute $1 trillion to the economy.
Congress got it right with the Small Business Jobs Act of 2010, a bill that would provide needed funding, tax breaks and increased outreach to businesses. The provisions of the legislation have consistently received bipartisan support. However, the bill languished in the Senate in July mostly due to posturing and politics on both sides of the aisle.
As Congress returns from recess, it's time for lawmakers to do for small business what they did for Wall Street. Instead of merely talking about how small business will lead the economy out of the downturn, Congress needs to take action in passing the legislation to give small business the tools and support it needs to recover. By putting off this legislation, lawmakers are turning their backs on the nation's most plentiful job creators and contributors to our economy.
It is not easy for small businesses to create jobs when revenue is down and the economic climate is so uncertain. For many of our members, it's sink or swim time -- they are just trying to stay afloat through some rough economic waters.
Andrea Caplan, owner of the Body Politic, a massage studio in Bethesda, is a one-person business waiting for policymakers to focus on Main Street. She said the bill is a step in the right direction.
"If it would give sole proprietors like me any kind of a break on taxes on our health insurance, then I'm all for it," Caplan said. "Even if it's temporary -- for one year only -- I could use the money on some other business expense, like advertising or office improvements."
The measure offers small businesses much of what they want most -- access to credit and relief from taxes.
It would allow them to deduct their health-care costs from their payroll taxes for a year. Currently, self-employed people, unlike their larger counterparts, can't deduct their health-care costs as a business expense. The measure would also expand the types of equipment deducted for business expenses.
Moreover, it would provide $30 billion in funding to credit unions and community banks that could be lent to small businesses.
We at the National Association for the Self-Employed (NASE) believe that creating your own job is just as important as being hired for an office or factory job; the contributions of small business to local economies and communities are just as vital, if not more, as the contributions made by large corporations.
The nation's self-employed keep the economy hopping, which is why Congress needs to stop the partisan sniping and pass a bill that's good for America -- the Small Business Jobs Act.
Kristie Arslan is executive director of the National Association for the Self-Employed's legislative offices.