Nearly 80 percent of small-business owners say they support Congress undertaking comprehensive tax reform, according to a U.S. Chamber of Commerce survey set to be published April 4. More businesses — 84 percent — said that the complex structure of regulations and taxes now is negatively impacting their ability to do business. Other findings from the survey include:
— 79 percent of small businesses believe the U.S. economy is on the wrong track.
— 87 percent of small business owners want the government to provide economic certainty.
— 78 percent of small businesses surveyed said the debt and deficit is a threat to the success of their business.
As both the House and Senate move forward with tax reform, widespread doubt has taken hold as to whether these efforts have any real chance of evolving into votes this year — or in 2014, or even a year after that, National Journal reports. It is not so much that consensus does not exist on the need to simplify, close some tax breaks and loopholes, and lower corporate tax rates to help U.S. companies become more competitive globally. Rather, Republicans and Democrats are having trouble resolving whether an overhaul of the tax code should raise revenue to reduce the deficit.
Meanwhile, Ways and Means Republican Rep. Lynn Jenkins (Kan.), during a Twitter town hall, said Congress should slash the manufacturing deduction Hollywood and video game developers enjoy, along with the tax credit for electric vehicles. She also did not close the door on cutting the tax breaks corporate jet manufacturers and big oil receive — but did note that scrubbing those two subsidies from the tax code would raise ‘only’ $2 billion a year.
“Everything is on the table … and my sense from the chairman is everything is coming out and we’re going to start with a blank sheet of paper and you’re going to have to make the case for why your tax provision needs to remain in the code,” Jenkins said. “We’re going to talk about everything. Those [oil and corporate jet tax breaks] that we hear about day-in-and-day-out, they are not revenue-generators, they are headline generators. And the people who use them know that. But the list [of loopholes] is too long, just grab the tax code. Like I said, take them all off.”
The veterans of Congress’s previous tax reform, which occurred in 1986, say that reform efforts are in their beginning stages.
“The biggest stumbling block is the fact that Democrats think tax reform is a process to raise new revenue beyond economic growth, and I don’t think Republicans are going to vote for that,” Sen. Chuck Grassley (R-Iowa) said.
Despite the skepticism, the pace of activity on the tax front will only pick up when lawmakers return to Washington next week.
House Ways and Means Committee Chairman Dave Camp (R-Mich.) is expected to make several public pitches for tax reform. His schedule next week includes rare testimony before the House Small Business Committee and an appearance at the Tax Policy Center, a think tank with a reputation as an independent arbiter of the revenue impact of tax proposals.
Meanwhile, across the rotunda, Senate Finance Committee Chairman Max Baucus (D-Mont.) will continue to hold private meetings with members of both parties and will release an options paper next week on small business tax reform.