Contact: Kevan Chapman, (202) 314-2041
Big tax hike on horizon due to expiring tax rates
WASHINGTON, D.C., May 21, 2012 — Today marks the beginning of Small Business Week, and the National Federation of Independent Business is kicking off the week by focusing on the cost and uncertainty facing small businesses over taxes. Among the top problems:
- Tax compliance is disproportionately expensive for small businesses. According to NFIB research, it costs small businesses around $74 per hour to comply with the tax code. Research by the Small Business Administration Office of Advocacy says it costs around 206 percent more –around $1,500 per employee – for small businesses to comply with the tax code than it costs larger businesses.
- Uncertainty over rates burdening small businesses. Tax rates will go up on small businesses at the end of the year if nothing is done by the President and Congress. Nearly $500 billion in new taxes will fall disproportionately on small businesses.
- Some of the most popular small-business tax provisions will go away. Over 25 business groups have joined NFIB in signing a letter of support for legislation that would restore several of these provisions.
- Family businesses are threatened by a looming jump in the estate tax. The tax on the estates of deceased business owners would jump from 35 percent with a $5 million exemption to 55 percent with a $1 million dollar exemption, threatening to crush family owned small businesses that go through the death of an owner next year.
The NFIB will be highlighting different issues facing small businesses each day during Small Business Week. Tomorrow we will highlight the burden of health care costs on job creators.