U.S. Senate Rejects Competing Small Business Tax Plans
In an interesting turn of events, the House drafted and passed a tax relief plan for small businesses with fewer than 500 employees, which represent over 99% of small businesses. This legislation would give these businesses a 20% tax cut. When this bill reached the Senate, it was overwhelmingly shot down 73-24. The Obama bill, which allows tax breaks for hiring and captial investment passed by a much narrower margin, 53-44, as many democrats backed off from the bill. Small businesses, as represented here by the infograph yesterday, are increasingly uneasy over the economy. The economy in general has been slower, and people are spending less, which is leading to less business from small businesses. Additionally, businesses that work in back office roles like payroll and benefits, are being faced with dramatically increasing costs of complying with a littany new regulations. Small businesses are bleeding pretty badly right now, and they are set to get worse as more regulations kick in. It would seem that elected officials on both side of the aisle would see the damage being done to the most important segment of the economy, stop playing politics, and agree to tie off some of the hemorrhaging. However, it is election year, so neither side is going to give an inch when it comes to the other side's proposals.
Source - Bloomberg