Small Business Tax Reform: Modernizing the Code for the Nation’s Job Creators
WASHINGTON—Today, Members of the House Small Business Committee heard from a panel of witnesses representing all sectors of small business on a key issue facing not only America’s 29 million small businesses, but also Congressional leaders—tax reform.
“As the discussions surrounding tax reform echo in the Capitol, it is paramount that part of the conversation involves the job creators themselves – the startups; the entrepreneurs; and the small businesses that transform Main Streets across America,” said Chairman Chabot (R-OH). “However, as the technology revolution changes business ecosystems, the tax code continues to hold small businesses back.”
A Modernized Tax Code for the Modern Day Economy
Tax reform continues to be a top priority for both small business owners and the Committee. The last time the tax code was comprehensively updated was 31 years ago. The witnesses examined how the proposed changes in H.R. 3717, the Small Business Owners’ Tax Simplification Act of 2017, could impact the nation’s job creators.
“On top of the compliance burden, our tax code has not kept pace with our changing economy. Technology has been a game changer in the way we do business, evident by the explosion of ecommerce and the sharing economy,” said Kristie Arslan, Entrepreneur-in-Residence at the Small Business & Entrepreneurship Council and owner of Popped! Republic Gourmet Popcorn in Alexandria, VA. “We believe that a pro-growth tax code is vital to reinvigorate entrepreneurship and improve the competitiveness of the U.S. economy. Our nation needs a tax code that enables small business sustainability and growth – the combined approach of tax cuts, tax reform and tax simplification will get us there."
“Small businesses create about 64% of new private sector jobs. Yet the tax code is not user-friendly for small and medium-sized companies. Like most companies with fewer than ten employees, we don’t have a department or even a person dedicated to tax filings,” stated Taylor Wyatt, President of MotionMobs in Birmingham, AL. “Making the process of paying taxes user-friendly is very important, and this legislation would be a good step in that direction.”
“In our view, what is truly exciting is that these marketplaces have given rise to a new entrepreneur, the solopreneur. By our estimates, of the 4 million listings on Airbnb worldwide, 2 million are in the United States. Lyft claims about 100,000 drivers in the U.S. market while Uber has 1.5 million drivers worldwide,” added Miguel Centeno, Partner at Shared Economy CPA in Redondo Beach, CA. “And for all the work and trust and community these entrepreneurs are building, it is my view that what they are offered in terms of tax benefits is extremely lacking.”
“Introduced as a bipartisan bill, H.R. 3717 proposes commonsense changes to better meet the needs of the growing number of sharing economy operators and self-employed small business owners,” said Caroline Bruckner, Managing Director of the Kogod Tax Policy Center at American University in Washington, DC. “H.R. 3717 provides simplification and tax relief to small businesses navigating the uncertainty of the current tax code, particularly those taxpayers who are subject to the quarterly-estimated payment rules, the Form 1099 reporting rules, and self-employed small business owners paying for their own healthcare coverage.”