The disrespect out of Washington toward small business owners has officially crossed over into Twilight Zone territory. Ignored during virtually every phase of the stimulus and bailout episodes, they are now being stomped on as big-ticket government programs flail about for more stones to squeeze blood from.
From the New York Post:
By one estimate, the effective tax rate on the 26 million small businesses across the country — which in the past have accounted for more than half of the job growth in the US — has jumped to 50 percent from 40 percent, sucking valuable cash from the businesses.
Everything about this is stupid for both parties, as small business is responsible for 40% of the job creation in America.
A quick idea of what these new costs are below:
* An increase of 4.6% in federal taxes from 35% to 39.6% (expiration of Bush tax cuts)
* An increase in capital gains taxes from 15% to 20% (expiration of Bush tax cuts)
* A new tax of 3.85% on investment income, dividends, rents, royalties mandated in the new health care bill
* An increase in the Medicare payroll tax to 2.35% as mandated in the new health care bill
* In states like New Jersey and others, state and municipal taxes have been raised by the average of almost 2%
If you were planning a double dip in the economy deliberately, your plans might look something like the atrocity of new taxes listed above.