You hear about small business quite a bit in the debate over extending federal tax cuts for upper income earners, even though the vast majority of small business owners do not benefit from those top tax cuts. Only 3% of taxpayers with business income above $250,000 would be impacted if tax cuts for top earners expired next year.
The Main Street Alliance believes that small businesses are being used as a pawn in the tax debate and that it’s time to put a stop to it. Small business owners across the nation are taking part in a national day of online action today to get real small business voices heard in this debate.
Don Orange, who owns an auto repair shop in Vancouver, Wash. and is active with the Main Street Alliance, sums up what is at stake in this video and petition.
Meanwhile, Cynthia Barber Gale, the CEO and creative director of BarberGale Group in Pottstown, explains in an op-ed this week why preserving the tax cuts for the richest 2% will not create jobs, as some claim. It's worth a read:
Job creation doesn't work this way, in a vacuum. Business owners like me create more jobs when we need more employees to meet the demand for goods and services our businesses provide. And we deduct employee costs from our taxable income. So demand is the key to job creation — not tax cuts.
But "job creator" is an effective smokescreen for the effort to justify more tax cuts for the wealthy.
If the Bush tax cuts were extended past their Dec. 31 expiration date only for taxable household income below $250,000, but not for income above it, the vast majority of small business owners wouldn't be affected. Just 3 percent of taxpayers with business income have income above $250,000, and that 3 percent includes hedge fund managers, corporate lobbyists and big business CEOs earning extra income from sitting on the boards of other big businesses.
Tax cuts for small business "job creators" has a much nicer ring to it than tax cuts for hedge fund managers.