The American people face more empty promises from The Biden Administration as his presidency spirals out of control with inflation, taxes, and uncertainty. To avoid drowning in the surge of inflation, most small business owners have to raise prices to make ends meet. Others are choosing to operate in the red since they are still not back up to pre-pandemic levels, says the Washington Times. Only 7% of small businesses are fully recovered from the pandemic.
In 2021, many hard-working Americans were still struggling to stay afloat while the media was swept off their feet by the idea of The Build Back Better Plan. This $1.7 trillion package was proposed to fund an array of social investments from lower education and healthcare costs to extending the expanded child tax credit, says Forbes. The White House claimed “the working class is the back bone of the country. For too long, the economy has worked for those at the top, while working families get the short end of the stick.” Their rhetoric so far has been uninspiring to the American people and Senators in their own party. Senator Joe Manchin (D-WV) challenged Biden’s proposal by stating, “I’ve never found out that you can lower costs by spending more.”
Small business owners continue to live in fear of more tax increases after reviewing Biden’s Fiscal Year 2023 budget proposal that includes at least 36 direct tax hikes on Americans. Those new taxes stack up to $2.5 trillion over the next decade. Tax increases include erasing much of the 2017 tax cuts, which helped bring unemployment levels to historic lows and economic growth to historic highs following its passage. In our day-to-day lives, we will be experiencing higher prices of goods and services due to this change, and tax increases would only make the situation worse for consumers. A 2020 study by the National Bureau of Economic Research found that 31% of the corporate tax falls on consumers. Americans are already scraping to make ends meet as inflation hits its highest reading in 40 years, so how will they weather more tax hikes and bad economic news?
Biden plans to increase the top income tax rate to 39.6%, hitting small businesses organized as sole proprietorships, LLCs, partnerships, and S-corps. He created a new “billionaire’s minimum tax,” which would tax unrealized gains for the first time in history. He doubles the number of families subject to the hated death tax. The budget also proposes to repeal deferral of gain from 1031 like-kind exchanges. That would complicate things for small real estate investors by forcing them to forego new investments or take on unneeded debt. Small businesses of all shapes and sizes would come out on the losing end if these policies were implemented.
Hardworking Americans have been weathering the storm since the pandemic, but there seems to be no ray of hope in sight under this administration and current leadership in Congress. Voters in November will decide if Democrats in Congress truly have America’s small businesses’ best interests in mind.
Bob Carlstrom is President of AMAC Action