What are Small Business Owners Worried About?
Higher Taxes and Higher Costs; Lower Wages and Layoffs
Higher Taxes and Higher Costs
New Taxes and New Penalties for Small Businesses
“Under another new tax, businesses would have to surrender 8% of their payroll to government if they don't offer insurance or pay at least 72.5% of their workers' premiums, which eat into wages. Such "play or pay" taxes always become "pay or pay" and will rise over time, with severe consequences for hiring, job creation and ultimately growth.”
—The Wall Street Journal, “The Worst Bill Ever”, November 1, 2009
“No one needs healthcare reform more than small businesses, but so-called reform that increases costs for small businesses, taxes jobs and eliminates healthcare options currently available to small employers is simply unacceptable.”
—J.J. Darby, South Carolina director of the National Federation of Independent Business, November 3, 2009
Taxing the “Wealthy” Hits Small Businesses
“However, the surtax as currently proposed would have an even more direct affect on jobs--because it would be a direct surtax on hundreds of thousands of small businesses. […] Out of the approximately 300,000 joint tax filers earning over $1 million, about 90 percent have small business income. Thirty percent earn more than half their income from their small business. These small business tax filers would face a sudden increase in their tax burden.”
—Rea S. Hederman and Guinevere Nell, “Pelosi Health Care Plan: Who Pays The Surtax?” The Heritage Foundation, November 6, 2009
“When will those who support these tax hikes wake up to the fact that they are sucking oxygen out of the very businesses that need this capital for survival and growth. Businesses can't save or create jobs without money. All of the tax increases proposed in the House health bill will deprive the private sector of the capital it needs to hold onto their workers, create more job opportunities, invest, innovate and grow.”
—Karen Kerrigan, President of the Small Business & Entrepreneurship Council, November 3, 2009.
Lower Wages and More Layoffs
Worker’s wages will decline
“Expanded health care coverage coupled with accelerated health inflation rates produce even worse results. The resulting rapid escalation in health benefit costs would drive disposable wages downward across most of the earnings spectrum, although lower-earning workers would be the hardest hit.”
—Steven A. Nyce and Sylvester J. Schieber, “Productivity Rewards and Pay Illusions Caused by Health and Retirement Benefit Cost Increases”, July 31, 2009
In the long term, layoffs and lower take-home pay
“Uninsured employees will effectively pay the entire cost of mandatory premiums through job loss, shifts in the terms and conditions of employment, and lower take home. That will not occur over night, but it will occur because compensation, regardless of its distribution between wages and benefits, is reasonably stable over time[…]”
—National Federation of Independent Businesses, “The Case Against Mandated Employer Provided Employee Health Insurance.”
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