Today, President Obama will gather with the titans of Wall Street to promote his $1.6 trillion tax hike plan to avert the fiscal cliff. Main Street business owners across the country are speaking out too, warning that the President’s tax hikes, financed on the backs of Main Street, will turn the fiscal cliff into a jobs cliff.
A recent survey conducted by the National Association of Wholesalers and Distributors (NAWD), a trade association whose membership includes pass-through businesses affected by the President’s tax increase proposal, finds that employers are already taking steps to curtail hiring and investment due to the threat of tax rate increases. According to survey responses, those actions include adjusting hiring plans, holding back on capital expenditures and other changes that directly affect their own workforce.
- 70% have made business decisions because of the threatened tax increases
- 77% have postponed hiring
- 22% have reduced their workforce
- 47% postponed or cancelled an anticipated expansion
- 63% postponed or cancelled a capital expenditure
- 21% reduced or eliminated employer contribution to employee 401(k) plans
- 29% reduced or eliminated employer contribution to employee health care
- 17% have taken other actions
The data echoes the uncertainty and concern that has become a familiar refrain for job creators reacting to the Obama Administration’s policies. As the Tax Relief Coalition (TRC), a coalition of more than 1,000 trade groups representing 1.8 million businesses of all sizes, and its members have said, American job creators simply cannot afford the President’s “balanced” plan. Instead, they believe a credible and balanced solution includes real policies to reduce spending and tax policies that will protect all taxpayers.
“The proposed tax increases will drastically affect how we can reinvest in our operation and how well we can compensate our employees. More to the government means less for expansion and less for employees.”
(NAWD member responding to survey of pass-through members on tax rate increases)
“I see a lot of pent-up demand in the marketplace that, with the burden of uncertainty removed, could be a tremendous boost to the economy. But without action and with massive tax hikes looming, this opportunity for success will vanish completely.”
(Austin Ramirez, CEO of HUSCO International, and a member of the National Association of Manufacturers)
“A real and sustained economic recovery cannot occur until many of the millions of Americans currently unemployed or underemployed are returned to the workforce as working taxpayers. Attempting to fix the fiscal cliff by revenue increases alone that will slow down the recovery and job creation simply will not work. TRC members believe that a credible bipartisan plan for long-term deficit reduction and economic growth would produce the immediate benefits of reducing uncertainty and improving financial stability and set the stage for long-term deficit reduction through comprehensive tax and entitlement reform.”
(TRC letter, 12/3/12)