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Home Publications Blogs Beat the Press The Vast Majority of Small Businesses Have Nothing To Fear From the End of the Bush Tax Cuts

The Vast Majority of Small Businesses Have Nothing To Fear From the End of the Bush Tax Cuts

Thursday, 12 August 2010 07:16

The Post had a piece on the expiration of the Bush tax cuts which reported an analysis by the Joint Committee on Taxation on the incidence by income group. The article noted that the analysis showed that 97 percent of tax filers reporting small business income would not pay higher taxes under the tax plan put forward by President Obama. However, it reported that 50 percent of small business income goes to taxpayers who would see an increase in their taxes.

It would have been worth noting that in most of these cases the tax increase would be trivial. For people with incomes between $200,000 and $500,000 the average tax increase would be $409 as shown in the chart accompanying the article. It is difficult to believe that a tax increase of this magnitude would affect business decisions to any noticeable extent.

Comments (6)Add Comment
Works Progress Administration
written by Scott ffolliott, August 12, 2010 7:48
The vast majority of small businesses benefited from the stimulus package and would benefit even more if the economic stimulus package were extended to municipal and state workers in all 50 states that are now in crisis
let the rich eat bread
written by frankenduf, August 12, 2010 7:52
some of the public policy rhetoric has become clearly disingenuous- on the one hand, there are calls for austerity presuming that suffering is a responsible burden for the populace to pay in acknowledging we've lived beyond our means- then, on the other hand, inducing suffering of 1% of the wealthiest citizens on the order of 409/larger than lifetime # of the masses, you get cries of class warfare- again and again, Orwell is proven to have keen insight into rhetoric of the power class
written by izzatzo, August 12, 2010 9:01
Once there was a goose
From which the eggs were golden

A trickle down goose with piles of eggs
That widened eyes beholden

Come one and all to the bubble ball
Held by parasites emboldened

Small business too we will screw
With fears of tax withholden

Win or lose the corporate way
Show your hand or fold 'em

If not for us you'd be off the bus
Your small business in the doldrums
written by fuller schmidt, August 12, 2010 9:55
The political class has no ideas beyond greed. However, I have ESP: the only feasible investment for the US now is to turn our entire country into an environmentally sound jewel that attracts tourism, with the costs for doing so shared proportionately by everybody.
written by Queen of Sheba, August 12, 2010 11:00
The only people who will be negatively affected by Obama's plan to repeal Bush's tax cuts (on those earning $200,000+) are the people who have enjoyed those tax cuts in the years since their enactment. What's their problem? It's not like they're being asked to repay their past gains. Man up, I say! People are actually suffering out here while these babies are bitching and moaning about a 4.5% tax increase. Weenies....
Everybody thinks small business is cute an' cuddly
written by JHM, August 13, 2010 5:33

Dear Dr. Bones,

... 50 percent of small business income goes to [the 03% of SB] taxpayers who would see an increase in their taxes ....

Guess which percentiles of SB have enough spare change to pay for all the agitation and propaganda and general selfservicement that one hears on this topic!

Unless, to be sure, Big Management generously pays for what it supposes pettymanagement to want -- and in any case wants for itself.

Or unless all those hired-hand G.O.P. geniuses at the Tanks of Thought are agitproppin’ vicariously in the path of St. Adam of Edinburgh and Mlle. de la Main Invisible. Out of PC, Political Capitalist, piety, that is, quite without reference to the hands’ personal bottom lines.

One of these days I shall have to work up my speculation that the Party of Grant & Hoover &c. are, to a remarkable extent, still livin’ in Grovers Corners VT [http://j.mp/2vjsv], where WilderBank and the Thornton Widget Trust were large frogs only because there was not much of a pond.[1]

Meanwhile, sir, I tust the Muses and Dr. Baker and you and I are quite immune to the purely sentimental side of militant extremist Republicans singin’ "The Small Business Blues" as they pass the tin cup ’round amongst their CCC, campaign-contributin’ classes. Like Prof. Krugman, though, Dr. Baker is usually not half as good on the politics of these human events as on the economics.

Happy days.

[1] Freelord von Böhner and Freelord von Kantor and most of the rest of the Grantite party pols (as opposed to authentic Big Managers properly credentialled with MBA degrees from the H*rv*rd Victory School) seem to have no idea what the Daughters of Virtue and Sons of Wisdom LLC will actually DO next year when they control at least 134.7% of both houses of Congress. At least part of this cluelessness, I attribute to their desire to bring back Grovers Corners, that wonderful small-town America that really did LOOK like America, in which the local Chamber of Commissars [http://j.mp/bniYOq] ruled the roost socially as well as every other way. In which only the town drunk and the village idiot had anythin’ much to do with "the Democrat Party."

("Where are you now, George Babbitt?")

Presumably some of the G.O.P. campaign-contributin’ classes are Babbitt wannabes whose notion of bliss is a holy Homeland™ run by and for people recognizably like themselves. But only some.

In any case I think you can see, sir, why it is not easy for their Leadership to turn such a hormone-based collective self-preference into a definite program of legislation. The unspeakable Ronpaulryan has done just that [http://j.mp/8ZSY43] , but the odious whippersnapper says himself "I am proud to have 13 House Republicans co-sponsor the legislation" -- thirteen out of one hundred and seventy-eight (178) militant extremist Representatives. About 07.5%.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.