Reader’s view: Obama’s policies will hurt small businessesWhere’s the incentive to risk capital to start or expand businesses? The outlook to expand business and hire employees is dismal if the Bush tax breaks are allowed to expire and President Obama follows through with increasing tax rates for the supposed rich.
By: Dave Goldberg, Duluth News Tribune
Where’s the incentive to risk capital to start or expand businesses? The outlook to expand business and hire employees is dismal if the Bush tax breaks are allowed to expire and President Obama follows through with increasing tax rates for the supposed rich.
The general public doesn’t understand how little is left from any business’ profit (assuming there is a profit) after federal and state income taxes and inheritance taxes. Assuming you’re one of the targeted rich who makes more than $250,000 per year, here’s the sad story of what you have to pass on to your heirs.
Assume $1,000 in new income. It’s actually $470 with the new federal tax rates and Obamacare taxes of about 44 percent and Minnesota state incomes tax of 9 percent. With federal inheritance taxes reverting to 55 percent and Minnesota inheritance taxes averaging 8 percent, it’s actually $174 left to leave your heirs. Like many “rich” small businessmen who started with nothing but ambition and hard work and who lived within our means to build decent estates after paying our taxes, I’m not comfortable giving our federal and state governments $826 of every new $1,000 earned.
Paying for out-of-control government spending and the redistribution of wealth will not attract new small-business investment.
Small-business prospects are really hurting. With the added costs of Obamacare and the stringent loan requirements dictated by bank regulators, starting and maintaining a small business is becoming very difficult.
All this talk from our administration about helping small business is political rhetoric and myth. If you are eventually successful, the federal government wants to increase your taxes and take away most of your estate when you pass on.
Take away the tax deductibility of charitable donations and you’ve created a death sentence for many of our worthwhile nonprofits.