Working for Jobs
 
Jobs numbers reported today said the unemployment rate for January was 9.7 percent.  That’s down from 10.0 percent in December.  It’s a move in the right direction.
 
But overall jobs losses remain severe.  Both employment surveys – the Household Survey and the Payroll Survey – showed America’s economy lost more than 8 million private sector jobs since the beginning of 2008, while government jobs have remained nearly the same.

I’m working in the Senate for tax relief to encourage private sector job creation.  The President’s newly proposed budget has some tax relief that’s generally agreed would encourage investment and hiring.  I support eliminating the capital gains tax from new investments in small businesses.  It’s something I included in the small business tax relief bill I introduced last summer.  I also support extending the provisions for small businesses to immediately expense up to $250,000 of qualified investments.  My small business bill allows immediate expensing up to $500,000.  Small business owners say this kind of tax relief encourages investment and job creation.  But the President’s new budget proposal also would increase taxes on families earning more than $250,000 per year.  The nonpartisan congressional experts at the Joint Committee on Taxation say 44 percent of the income from flow-through businesses will be hit with the President’s proposed tax rate hikes.  Small business owners usually operate their businesses by using these kinds of flow-through entities, such as partnerships, S corporations, and LLCs.  The National Federation of Independent Business says about half of small businesses with 20 or more employees are owned and managed by the people these tax increases would hit.

We’d be shooting ourselves in the foot to raise taxes right now on the people who create jobs, and it would be contrary to the President’s stated goal to help small businesses, where 70 percent of new jobs are created.  What’s more, serious threats to small business loom in the current public policy debate, including higher taxes and more regulations mandates in health care reform and the cap-and-trade bill passed by the House of Representatives.  Congress will be spitting in the wind with modest tax relief for small business if it doesn’t also reverse the bad environment for small business growth.