Good morning. We meet today to consider H.R. 9, “The Small Business Tax Cut Act.” This legislation will allow a business with fewer than 500 employees to take a tax deduction equal to 20 percent of their active business income and applies to businesses and business owners who pay their taxes at the individual or corporate level.
Whenever I am talking with small business owners back home, the question I am often asked is, “What can Washington do to help small businesses so that they can expand their operations and hire new workers?”
There is no doubt that comprehensive tax reform that lowers rates and makes the code simpler and fairer is key to achieving that goal. While we pursue comprehensive tax reform that gives businesses of all sizes the certainty they need to invest and hire for the future, we need something that can help small businesses today.
The Small Business Tax Cut Act provides the help that small businesses need right now. This deduction can free up resources so a small business can invest, hire another worker or provide a raise to an employee – something too many employers haven’t been able to do in this weak and slowly recovering economy. Small businesses will be able to take advantage of the deduction immediately in 2012, which can incentivize the job growth we need to help get Americans back to work.
Small business owners in my district agree. Michigan has been hit especially hard with double-digit unemployment rates over the last three years, and these business owners are the real experts who know what they need to add jobs back to our communities.
Take for example, Bob Yackel, President of Merrill Tools. As part of the 400-employee Merrill Technologies Group, Mr. Yackel says, “As a manufacturing business in Mid-Michigan, we know firsthand the ramifications of the recent economic turmoil. The best way Washington can help energize economic growth is by making sure business owners are spending less on tax payments and more on creating jobs.”
Bob Yackel is a larger small business owner, but there are smaller businesses that feel the same way. Jim Holton, owner of Mountain Town Station in Mount Pleasant, has served the central Michigan community as a restaurant owner for more than 15 years. He is especially pleased with the simplicity and ease of this legislative approach. He says, “The beauty of the Small Business Tax Cut Act is its simplicity. If you are earning profits and contributing to the economy, then you can take 20 percent off your tax bill. No hoops to jump through. This is a great way for business owners like myself in the Great Lakes Bay region and across America to help jumpstart our economy.”
Those are just two examples in Michigan’s Fourth District, but they echo small business owners across the country. Throughout our history we have depended upon these industrious and innovative risk-takers to help us move through tough economic times. While we work to provide them the long-term comprehensive tax reform they need, we can also take steps today to unlock new opportunities for them immediately. The Small Business Tax Cut Act is a bill that provides those much-needed, immediate opportunities.