Graves' Statement on Tax Day and the Small Business Tax Burden

f t # e
Washington, Apr 15 | comments
Small Business Committee Chairman Sam Graves (R-MO) today released the following statement on Tax Day and the effects of tax policies on small businesses:

“Every year, the tax burden becomes more costly for America’s 28 million small businesses. The tax code is increasingly complicated and changes often. Most small businesses spend 40 hours or more preparing their taxes, and four out of ten businesses spend two full workweeks on compliance. That is a high cost in lost time and productivity for a small business. One in three small firms spends $10,000 on compliance. Jobs are still scarce, and the combined burdens of complex taxes and high rates are obstacles to growth. The jobs-stifling tax code is not just a Tax Day problem for small companies, but a year-round burden on their budgets that can impact their entrepreneurial decisions. Small businesses overwhelmingly support sensible reforms for lower rates, simpler preparation and clearer guidelines.”

Last week, the Small Business Committee examined these very challenges for small businesses. The growing number of tax provisions means that owners must spend significant resources on compliance that could otherwise be spent growing their companies. According to the Internal Revenue Service’s own National Taxpayer Advocate, there were over 500 changes to the tax code in 2010 alone, an average of more than one per day. And the steep tax rates mean small firms have less capital to invest back into hiring or expanding.

The National Small Business Association released a survey on April 9, 2014, in conjunction with the testimony of NSBA member Tim Reynolds, a small business executive. The growing complexity of the tax process causes 86 percent of small businesses to pay tax preparers.

###
f t # e
Tags: Taxes