March 9, 2017
Atlanta – Today the Job Creators Network (JCN) affirmed its support for the Bring Small Businesses Back Tax Reform Act (H.R. 1425)—introduced this week by U.S. Representatives Randy Hultgren (IL) and Jason Smith (MO). The legislation would reduce the tax burden on the nation’s largest job creators—small businesses.
Alfredo Ortiz, president and CEO of the Job Creators Network, and Stephen Moore, distinguished fellow at the Heritage Foundation, had an op-ed in The Hill this week highlighting the legislation. Read the op-ed here.
The BSBB Tax Reform Act would:
Lower the tax rate for small businesses’ first $150,000 of income to 12 percent and to 25 percent for all income above that threshold.
Allow small businesses to immediately expense all investment in equipment.
Permit small businesses to defer income declaration until payment is actually received.
American small businesses need these tax reforms now. Small business expansion has slowed to a crawl and the number of new entrepreneurs attempting to open a business has declined—with the number of businesses less than a year old falling by one-third since the 1980s. The engine of small business job creation is idling and to kick-start it we need to focus on reforms, such as this legislation, that will target the majority of small business job creators.
Seventy percent of small businesses do not pay taxes at the corporate rate. They are structured as sole proprietorships, partnerships, or S-corps and the profits they make are “passed-through” to the owner and counted as individual income on their tax returns. These entrepreneurs can pay federal tax rates as high as 40 percent. This is why it is so important to address the rate at which specifically small businesses—or “pass-throughs”—pay taxes.
“American small businesses need tax reform immediately and the Bring Small Businesses Back Tax Reform Act is a major step in the right direction,” said Alfredo Ortiz, President and CEO of the Job Creators Network. “By reducing the tax rate for “pass-through” small businesses, they will have more resources to expand their companies and hire new employees—strengthening the entire American economy. Comprehensive tax reform for all should be the end goal, but for now we need to give relief to the most vulnerable entities among us—small businesses.”