As Dems Threaten Tax Hikes, Small Businesses Hold on Hiring

August 8, 2012

Small Businesses Stall in the Grim Economy, But Democrats’ Tax Hike Plan Would Only Make Life Harder

Small businesses remain pessimistic in the Obama economy and many are holding off on hiring because of concerns over the state of the economy.
The Democrats’ threat to raise taxes could cause even more worry for small businesses because the proposed tax hikes would fall heavily on small businesses and could cost more than 700,000 jobs.
The government takeover of healthcare created by Democrats has already been a living nightmare for America’s job creators, and their tax hike threat will only serve to make life difficult for more small businesses.

Small businesses remain pessimistic in the Obama economy and many are holding off on hiring because of concerns over the state of the economy:

“SMALL BUSINESSES EXPECT LACKLUSTER SALES GROWTH, SURVEY SHOWS”: (Jose Pagliery, “Small Businesses Expect Lackluster Sales Growth, Survey Shows,”CNN Money, 8/7/2012)

PESSIMISM RISING, 54% EXPECT REVENUE TO FALL OR REMAIN FLAT FOR THE NEXT YEAR: “A quarterly poll by Gallup and Wells Fargo (WFC, Fortune 500) found that 54% of small firms expect their revenue will fall or remain flat in the next 12 months, up from 48% the previous quarter.” (Jose Pagliery, “Small Businesses Expect Lackluster Sales Growth, Survey Shows,” CNN Money, 8/7/2012)

63% “TOO CONCERNED ABOUT STATE OF THE ECONOMY” TO MAKE NEW INVESTMENTS: “Of the 600 small business owners interviewed, 63% reported being too concerned about the state of the economy to make any new capital investments until mid-2013.” (Jose Pagliery, “Small Businesses Expect Lackluster Sales Growth, Survey Shows,” CNN Money, 8/7/2012)

GALLUP: “U.S. SMALL-BUSINESS OWNERS’ OPTIMISM DECLINES IN JULY”:(Dennis Jacobe, “U.S. Small Business Owners’ Optimism Declines in July,” Gallup, 8/7/2012)

SURVEY: “MOST SMALL BUSINESSES DON’T PLAN TO HIRE IN COMING MONTHS DESPITE BEING UNDERSTAFFED” DUE TO CONCERNS ABOUT ECONOMY: “Many small business owners are holding back on adding more employees in the coming months because of concerns about the economy — even as some report that their businesses are understaffed.”(“Survey: Most Small Businesses Don’t Plan to Hire in Coming Months Despite Being Understaffed,” Associated Press, 7/30/2012)

70% OF SMALL BUSINESSES NOT HIRING NEW WORKERS, EVEN AS 35% REPORT BEING UNDERSTAFFED: (“Survey: Most Small Businesses Don’t Plan to Hire in Coming Months Despite Being Understaffed,” Associated Press, 7/30/2012)

“SMALL BUSINESSES EMPLOY ABOUT HALF OF ALL U.S. WORKERS,” SO “FINDINGS DON’T BODE WELL” FOR JOB CREATION THIS YEAR: (“Survey: Most Small Businesses Don’t Plan to Hire in Coming Months Despite Being Understaffed,”Associated Press, 7/30/2012)

The Democrats’ threat to raise taxes could cause even more worry for small businesses because the proposed tax hikes would fall heavily on small businesses and could cost more than 700,000 jobs:

FORMER CBO DIRECTOR: DEMOCRAT PLAN TO HIKE TAXES IS “MADNESS”:(Ronald D. Orol, “Democrat Idea to Let Bush Tax Cuts Expire Is ‘Madness’,” MarketWatch, 8/2/2012)

FEDERAL RESERVE CHAIRMAN BEN BERNANKE: IF DEMS GET THEIR WAY “RECESSION WOULD OCCUR EARLY NEXT YEAR”: “The Congressional Budget Office has estimated that, if the full range of tax increases and spending cuts were allowed to take effect–a scenario widely referred to as the fiscal cliff–a shallow recession would occur early next year…” (Bernanke testimony before the Senate Banking Committee, Federal Reserve Web site, 7/17/2012)

89% OF DEMOCRATS VOTED AGAINST PREVENTING TAX HIKES(Roll Call 545,Clerk of the U.S. House, 8/1/2012)

JOINT COMMITTEE ON TAXATION: 940,000 SMALL BUSINESSES TO GET HIT BY DEMOCRATS’ LATEST TAX HIKE: “Congress’s Joint Tax Committee—not a conservative outfit—estimates that in 2013 about 940,000 taxpayers will have enough business income to meet Mr. Obama’s tax increase threshold.”(Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

710,000 JOBS COULD BE DESTROYED BY DEMOCRATS’ TAX HIKE PLAN: (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012, Appendix C)

1.8% DROP IN WAGES: “Real after-tax wages would fall by 1.8%, reflecting a decline in workers’ living standards relative to what would have occurred otherwise.” (Robert Carroll and Gerald Prante, “Long-Run Macroeconomic Impact of Increasing Tax Rates on High-Income Taxpayers in 2013,” Ernst & Young, July 2012)

MORE THAN HALF OF NET BUSINESS INCOME WILL BE HIT BY HIGHER TAX RATES UNDER OBAMA PROPOSAL: “And of the roughly $1.3 trillion in net business income, about 53% will get hit with the higher tax rates. This is because millions of businesses report their income as sole proprietors and subchapter S corporations that file under the individual tax code.” (Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

OBAMA’S NEW TAX HIKE WOULD HAVE SOME SMALL BUSINESSES PAYING HIGHER TAX RATES THAN GENERAL ELECTRIC AND J.P. MORGAN: “So Mr. Obama wants these businesses to pay higher tax rates than the giant likes of General Electric or J.P. Morgan. Does that qualify as ‘tax fairness’?” (Editorial, “Off the Tax Cliff He Goes,” The Wall Street Journal, 7/10/2012)

The government takeover of healthcare created by Democrats has already been a living nightmare for America’s job creators, and their tax hike threat will only serve to make life difficult for more small businesses:

CBO: $1 TRILLION IN OBAMACARE TAX HIKES OVER 2013-2022: (Douglas Elmendorf, “Letter to the Honorable John Boehner,” Congressional Budget Office, 7/24/2012, p.6)

NFIB STUDY: 150K SMALL BUSINESS JOBS COULD BE DESTROYED BY OBAMACARE’S HEALTH INSURANCE TAX: (“NFIB Research Foundation Study: Health Insurance Tax to Cost 125,000 to 249,000 Private-Sector Jobs,” NFIB, 11/9/2011)

AT LEAST 14,500 JOBS OR AS MANY AS 47,000 JOBS COULD BE DESTROYED BY OBAMACARE’S HEART ATTACK TAX: (Michael Ramlet, Robert Book and Han Zhong, “The Economic Impact of the Medical Device Tax,” American Action Forum, 6/4/2012)

13,303 SMALL- TO MEDIUM-SIZE MEDICAL DEVICE FIRMS IN U.S., OR 91% OF ALL MEDICAL DEVICE COMPANIES COULD BE AFFECTED: (Michael Ramlet, Robert Book and Han Zhong, “The Economic Impact of the Medical Device Tax,” American Action Forum, 6/4/2012)

INTERNATIONAL FRANCHISE ASSOCIATION: “3.2 MILLION JOBS AT FRANCHISE BUSINESSES CONTINUE TO BE PUT AT RISK”:(“High Court Ruling Puts Jobs at Franchise Businesses at Risk,” International Franchise Association, 6/28/2012)