The column below reflects the views of the author, and these opinions are neither endorsed nor supported by WisOpinion.com.
After plenty of negotiations, Republicans in Congress have released a new blueprint for tax cuts. And President Trump debuted the plan right here in the Midwest. “This is a once-in-a-generation opportunity,” he told a cheering Indianapolis crowd. Capping rates at 25 percent for America’s millions of small businesses, he said, will secure them the most dramatic tax relief in generations.
Small businesses have been waiting a long time, and for all that these businesses do for us, the tax code doesn’t reward them with fair rates. As so-called “pass-through” entities, the overwhelming majority of small businesses are unfairly stuck with the highest possible individual tax rate, taking a chomp out of revenues that are often disproportionate to a business’s size. With top federal rates currently hovering around 40 percent, state and local taxes can bring the small business tax burden to 50 percent. The government should not take half of a business’ income under any circumstance.
And that’s before spending time and money on tax filing. For every three small businesses, two resort to outside help, and one has to devote a draining two weeks’ worth of work time to tax compliance every year. Under that pressure, America’s 29 million small businesses still manage to keep on the lights. Imagine what they could do if Congress lifted the tax shackles around their necks.
I’ve seen the power of small business firsthand in Wisconsin, where I’ve spent decades in the private sector. Statistics from the Small Business Association tell the tale: More than half of our roughly 2.5 million workers are employed by our 440,000 small businesses, which make up over 97 percent of all Wisconsin businesses. In fact, those with 100 employees or fewer have the greatest share of employment. Together, they’ve helped grow Wisconsin’s economy faster than the national rate, and pushed employment above the national average.
But I’ve also experienced the burdens small businesses face, helping my husband Craig run several boating businesses in Wisconsin. Like all small businesses, we want ours to grow and better serve our neighbors and friends. But it’s too difficult when taxes strip away half of our income.
I’m confident that a lighter tax load would help a rising tide of small businesses lift all America’s boats. In response to a survey from the Job Creators Network, a majority of small businesses said they’d use new tax savings to add workers, bolster wages, or expand operations.
Americans agree because they’re familiar with the benefits small business provides year in and out. According to polling from the American Action Network, almost 75 percent of voters agree getting a proper tax bill passed this year is a top priority for Congress—or the top priority. Even more—four in five—say that any tax package should encourage job creation and retention right here at home. Small businesses are poised to do exactly that.
The White House has showed admirable tenacity in keeping lawmakers focused on the message voters and small businesses are sending. By passing the tax cuts President Trump praised in Indianapolis, Congress can right a longstanding wrong and put the wind back into our economic sails.
— Duchow, R-Delafield, represents the 99th Assembly District.