NFIB And Small Business Make the Difference in Washington, D.C.
2007 was a challenging year for the NFIB lobbying team. The following is a summary of our legislative victories, as well as our successful efforts to stop legislation that would hurt America's small-business owners.
H.R. 800, the So-Called "Employee Free Choice Act"
On March 1, the House passed H.R. 800, the so-called "Employee Free Choice Act" – a bill NFIB strongly opposes. NFIB key voted against this bill in the House and was successful in preventing it from being voted on in the Senate.
H.R. 800 would replace federally supervised private-ballot union elections with an inferior "card-check" system. "Card check" refers to unsupervised card-signing campaigns preferred by unions. It allows union organizers to pressure workers to publicly sign cards stating they want to join a union. Workers would never have the option of voting against union membership, and employers would intentionally be kept uninformed of union presence.
Not surprisingly, a recent survey found that fully 87 percent of likely voters agree that workers should continue to have the right to a federally supervised secret ballot election when deciding whether to join a union. Among union households--at 90 percent--the number is even higher. Voters also plan to hold members of Congress accountable for their vote on this issue, with 70 percent of all voters and 75 percent of union households saying they are less likely to support someone who voted to take away private ballots. What is surprising is that despite this opposition, banning the use of secret ballots remains the top legislative priority for the large national unions contributing millions in this year's election.
NFIB members also need to know that if a business did become unionized by card check, this disingenuous legislation would then empower arbitrators to impose a binding contract if the parties don't reach agreement within only 120 days. NFIB intends to remain active in this fight this year and beyond, and is wholly committed to preventing its passage in both chambers and is pleased the president is committed to vetoing it.
Patching the AMT With No Tax Increases
NFIB worked hard to prevent a massive tax increase on many small-business owners by urging congress to pass an Alternative Minimum Tax patch. NFIB's efforts were critical in ensuring that congress did not raise taxes to pay for this tax relief. Without this patch, 23 million taxpayers would have been subject to the AMT.
The AMT was originally enacted to ensure that the wealthiest taxpayers were not able to avoid paying taxes. Because the AMT was never indexed for inflation, it impacts more middle-income taxpayers each year--including many small-business owners. NFIB believes that since the AMT was never intended to apply to middle-income tax payers, the revenue raised was also unintended and should not be paid for by raising other taxes.
The one-year AMT patch increases the exemption amount to $66,250 for joint filers and $44,350 for single filers, ensuring that no additional taxpayers are liable for the AMT this year. Since this patch only applies to the upcoming tax season, Congress will address this issue again next year. NFIB will continue to push for permanent repeal of the AMT without raising other taxes to pay for the repeal.
Small-Business Expensing
NFIB also worked diligently to get a small-business tax package included in the final version of the minimum-wage bill that was signed into law by the president in February. NFIB led the efforts to ensure this provision was attached to the final version of the minimum-wage bill. NFIB opposed the House-passed legislation, in part because it did not include a small-business tax package to offset the impact of the minimum-wage hike on small businesses.
Section 179 provides an incentive for business owners to invest in their businesses with the advantage of expensing the cost of the improvement in the year that the investment is made rather than over a certain number of years. This also simplifies the tax code by substituting first-year expensing for complicated depreciation schedules and timing rules.
Specifically, the Section 179 enhanced expensing for small businesses was increased to $125,000 for 2007 from $100,000 and increased the investment limitation from $450,000 to $500,000. Since the enhanced expensing is reduced once the owner hits the investment limitation, this change will allow them to invest more money into their business before the reduction is triggered. Section 179 was scheduled to expire after 2009, but has been extended through 2010 and the new limitation amounts were indexed for inflation.
NFIB will continue to work to make small business expensing permanent.
Extension of the Internet Tax Moratorium
NFIB pushed congress to extend the Internet tax moratorium for seven years, which will prevent most state and local governments from levying new taxes on Internet access or taxes that target Internet use.
NFIB strongly supported the legislation and key-voted its passage in the House. The newly signed law is set to expire in 2014, and NFIB will continue to advocate for a permanent ban on a tax on Internet access.
The Internet Tax Freedom Act Amendments Act of 2007 extends, for seven years, the current ban on taxing Internet access. It prevents most state and local governments from levying new taxes on Internet access services or new taxes that target the Internet. The ban does not, however, affect the broader issue of sales taxes on Internet purchases. It specifically prohibits taxes on e-mail and instant messaging services that are provided independently or not packaged with Internet access. It also exempts some states that approved taxes prior to the original enactment of the ban in 1998.
NFIB will continue to work to address the remaining issues relating to Internet taxation that were not addressed in the extension.
The Tax Gap
NFIB was also successful in blocking several tax gap proposals that would harm small business. The tax gap is the amount of tax owed to the federal government versus the amount of tax actually collected. In effort to increase collection, a number of proposals were introduced that could have a negative impact on small businesses.
The proposals most harmful to small business included those to expand information reporting on payments to corporations, to require a certified taxpayer identification number from contractors and to require information reporting on merchant payment card reimbursements. Tax compliance is already one of the major concerns for small-business owners and these requirements would have meant additional paperwork requirements increasing the compliance burden on small businesses. New filing requirements also increase the amount of money small-business owners spend on tax compliance. Finally, it is not clear that any of these proposals would have increased tax compliance.
NIFB recognizes that the tax gap is a true problem, and will continue to urge Congress and the administration to consider the implications that these proposals could have on honest and compliant small-business taxpayers. NFIB will also continue to work on more outreach to small-business owners about their tax obligations and simplification of the tax code as way to address the tax gap.
Blocking H.R. 2768
In opposing the Supplemental Mine Improvement and New Emergency Response Act, H.R. 2768, NFIB successfully blocked a proposal that would have bypassed a more deliberative process used to set exposure limits on certain substances in the workplace. Current safety and health laws, like OSHA, are obligated by law to consider the practicality of each regulation. Laws were created to protect employers from unreasonable and undue burdens. Bypassing this process and ignoring the economic and technological reality of a regulation could increase employers' confusion and result in many of them not being able to comply.
Had H.R. 2768 been enacted, the analyses that would be lost include those conducted on the impact of the regulation on small businesses (as required under the Regulatory Flexibility Act). Assessing these impacts is particularly important in fashioning a regulation so that the regulation will impose the smallest possible burden, while still protecting employees. Abandoning this process will result in unmanageable regulations, making compliance by small businesses much less likely.
Extended Hours for Truck Drivers
NFIB, along with the Hours of Service Working Group coalition, fought for and won longer hours for truck drivers. The Federal Motor Carrier Safety Administration recently handed down rules allowing truckers to drive 77 hours a week, up from the previous cap of 60 hours a week. These rules will aid the many small-business owners who depend on truck drivers to operate their businesses.
NFIB and the FMCSA defend the rules with new data that shows the trucker hours are safe. The new safety data indicates that under these rules the industry is operating as safe as ever. The rules retain key components of the 2004 truck driver work and rest rules, which have contributed to improved safety on the nation's highways. Although they are still in their final comment period, the rules represent a huge victory for trucking companies and all businesses that rely on trucking.
NFIB will continue to support and push to finalize the new rules on trucker hours.
