A poll from The Hill looks at how Trump’s Tax Cuts and Jobs Act is likely to affect small businesses in America. From the looks of it, the Republican plan will give yet more advantage to corporations, allowing them to further undercut the little guys, who are also, “the economic engine of our country,” representing some 30 million small businesses.
Although the $1.5 trillion tax revamp gives a 20 percent deduction to small businesses, those handouts are temporary and insignificant, and business owners know it. That could be an enormous problem when 90 percent of all U.S. businesses are pass-through entities, with small businesses making up “the lion’s share.”
The scientific public opinion poll from Businesses for Responsible Tax Reform, a coalition of business leaders “calling for tax reform that truly benefits America’s small business owners,” looks at views from 385 small-business owners in Arizona, Nevada, Maine, and Tennessee, four Senate battleground states. A majority of the respondents identified as Republicans with fewer than 10 employees.
The key findings:
- Seven in 10 small-business owners said they would not hire a new employee as a result of the new tax law.
- Six in 10 small-business owners said they would not be giving their employees raises.
- 54 percent of small-business owners say the tax law favors large corporations over small businesses.
- 55 percent of respondents do not believe the law puts small businesses on a level playing field with big businesses.
- Importantly, given the partisan nature of the law, 41 percent identify as Republican, 31 percent as Democrat and 28 percent as independent or something else.
- Further, most of the business owners opposed raising the debt by $1.4 trillion.
“These poll results show a law policymakers promised would reinvigorate the entire economy instead leaves half of it behind, widening the gap between the haves and the have-nots,” said Frank Knapp, the co-chair of Businesses for Responsible Tax Reform and president and CEO of the South Carolina Small Business Chamber of Commerce.
While many small business owners are thankful for any kind of tax cut, they were clearly not seeing the windfall that corporations will enjoy.
Although all Americans want to see higher salaries and less income inequality, the prospects for seeing their employers suddenly become egalitarian and altruistic are almost nil. It’s not as if decades of trickle-down economics haven’t already made that apparent.
In a recent poll from CNBC, only 10 percent of small businesses said they would use their deductions to raise employees’ salaries. One third said they would use any surplus to pay down debt, 22 percent said they would “invest in new facilities, equipment or technology,” and 12 percent said they would “pay for maintenance or repair of existing facilities, equipment or technology.”
Definitely not much at all to trickle down from the top for the average small business employee.
The story sounds the same in other parts of the country, according to a new report from the Globe Gazette.
“[I] didn’t pop any champagne when that bill got signed.” That’s because the potential savings, if there end up being any, won’t likely amount to more than a “couple weeks of revenue,” said Blake Woodard, the owner of a Fort Worth insurance company.
“It’s nice,” he said. “But it’s not so much money that it’s at all going to change your business’s year.”
Tax March, an organization working to repeal the Trump tax plan, shared similar sentiments from Houston.
Small business leader Travis Boldt makes clear this isn't a tax plan for small businesses:
— Tax March (@taxmarch) March 11, 2018
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Featured image: Trump celebrates tax plan, screenshot via YouTube