Small Business Continues to Speak Out Against Proposed Tax Hikes and Mandates

Date: June 02, 2022

Recent In Their Own Words videos highlight concerns from Arizona and West Virginia small business owners and NFIB State Directors echo their concerns in published Op-Eds

The video series “In Their Own Words” features small businesses from across the country and is part of NFIB’s Small Business Survival campaign, a coordinated advocacy effort that highlights why tax increases would be harmful to America’s small businesses.

The latest video in the series features Arizona small business owner Marty Giebelhaus, owner of Marlin Mechanical Corp., a plumbing business that has been in around for 40 years. Gielbelhaus expresses concerns about future tax increases and how that would affect his employees.

Giebelhaus explains: “We hope that there aren’t any future tax increases or rollback…of deductions on that either because it’s been an opportunity for us to invest more in our people. Our wages have gone up an incredible amount over the past few years and that’s just to keep up with the surrounding industries because it is getting incredibly difficult to find people and to retain people with the amount of work that’s going on. So, we have to compete, and in order to do that we have to offer our people the absolute best. We always have and we continue to do that, but it is definitely a struggle with being locked into long-term contracts…that goes with materials as well with the supply chain issues and the increases in costs. We can’t always bake that into a new contract.”

Arizona’s NFIB State Director Chad Heinrich recently published an opinion piece in AZCentral about the fight to defeat record-high inflation. In Arizona, small businesses employ 1.1 million people, which is 43% of the workforce in the state. Arizona has among the highest inflation in the country, so this is a top concern for small business owners.

“What to do? The first and most important answer is do no further harm,” Heinrich wrote. “The second answer is to listen to the problems and concerns of small businesses. I am pleased that Arizona’s governor, the Legislature and one of our U.S. senators have been doing both.”

Another recent video in the Small Business Survival series features NFIB member Christian Marsh of Quality Machine Co., Inc. in Bridgeport, West Virginia. Quality Machine Company is a family business started by Marsh’s grandfather and father. The company is tied to the energy sector.

“We have benefited by the pass-through deduction and that really helped us survive…these last few years have been very tough,” Marsh explains. “We had the kind of decline of oil and gas and then immediately following we had the pandemic. Right now, we have about one-third less workforce than we had four years ago. That’s a huge decline for us and that also shows in our gross sales and everything else. We would hate to see the pass-through deduction be taken away, not become permanent…that would be awful. It’s considered a tax on our net profit, but you know, this is not money that we’re stuffing under the mattress. This is money we’re using to survive and like I said, we’re surviving at a far less workforce…smaller gross volume of business as well. I think that would be adding insult to injury to take that deduction at this point with the current economic conditions.”

West Virginia’s NFIB State Director Gil White recently wrote an opinion piece published by The Weston Democrat that echoes Marsh’s concerns about changes the administration and Congress are considering along with new taxes and mandates.

“West Virginia’s small businesses need the Administration, along with Congress, to focus on solutions that bolster the fragile small business recovery and reject any legislation, like Biden’s Build Back Better Act, that would lead to higher taxes on Main Street businesses and impose unaffordable mandates and penalties on small businesses that are struggling to survive,” wrote White.

In March, the Biden Administration announced its 2023 budget request to Congress, which proposes substantial tax increases above and beyond the tax increases and mandates included in the Build Back Better Act. The proposals include increasing the corporate tax rate to 28%, creating a double death tax by increasing capital gains taxes and repealing stepped-up basis tax treatment, and more. The House-passed Build Back Better Act would expand the reach of the Small Business Surtax to active business income, created a four-week federal paid family and medical leave program, and substantially increased penalties for complicated employment law violations. To join in the fight against harmful tax increases and new mandates being considered in Congress, please consider emailing your U.S. Senators and Representative your concerns.

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