“We need to find a balanced solution to the fiscal cliff, but giving millionaires a tax cut and asking working families to cut back on their weekly food budget isn’t a balanced approach,” said Congresswoman Chellie Pingree commenting on the Republican “Plan B” that would cut food stamps to get avoid the fiscal cliff. “In fact, it’s downright cruel.”
Meanwhile members of the Maine Small Business Coalition voiced their concerns about the Republican plan and the impact a brokered deal would have on small businesses and the communities they serve. The Maine Small Business Coalition has been active in the fight to end tax breaks on income over $250,000 a year while protecting important foundational programs that support small business owners and their customers.
Republicans in Congress, including Maine Senator Susan Collins, have repeated claims that ending tax breaks for the top 2 percent would affect small businesses.
“The overwhelming majority of small businesses—97 percent, nationally—make less than $250,000 a year,” said John Costin, who owns Veneer Services Unlimited in Kennebunk. “32 out of 33 small business owners won’t lose a dime by ending those extra tax cuts at the top. Our country can’t afford them, especially when that revenue can be used to strengthen our local economies.”
For Sam Kelley, owner of MBI Trailers in Scarborough, tax rates are a low priority. “Not once in my 30 years as a business owner have I ever factored in the tax rates and whether they’ll go up or down when planning for coming year. You make an investment based on whether or not something is a good idea, not because of what your tax rate is going to be in the next year,” said Kelley.
Congress and the President are locked in a debate over how to reduce the budget deficit and whether to extend or end various tax cuts and credits, including the Bush-era tax cuts. Republicans have proposed deep spending cuts to foundational programs like Social Security and Medicare while continuing to extend tax breaks for millionaires. Republicans in the House of Representatives have proposed that the $250,000 threshold originally suggested by the President be moved upward to $1 million.
“It’s long past time to end the Bush tax breaks on income above $250,000. Adjusting that threshold upward only functions as a way to move the goalposts and continue protecting the wealthy from paying their fair share in taxes,” said Kevin Simowitz, Director of the Maine Small Business Coalition. “If we start changing that threshold, we lose billions of dollars in revenue, and some politicians want to cut programs like Social Security and Medicare as the solution. That’s a bad deal for small business owners and their customers who rely on those programs.”
In the 2007 census, 1 out of every 8 business owners in America was over 65, and a quarter of all business owners were between 55 and 64. Suggested cuts to Medicare or Social Security are a small business issue that will affect many small business owners in the near future. Since small business owners do not receive company pensions like individuals working in corporate America, programs like Social Security are a critical piece of basic retirement security for many small business owners.