Congress is at it again. Despite the much publicized agreement in principle last week between the President and Republican leaders to extend various tax cuts, the House Democrat leadership has decided to reject the agreement in its current form.
Here is the press release from Nancy Pelosi yesterday:
“We will continue discussions with the President and our Caucus in the days ahead. Democratic priorities remain clear: to provide a tax cut for working families, to promote policies that produce jobs and economic growth, and to assist millions of our fellow Americans who have lost their jobs through no fault of their own.”
While the tax cuts will most likely pass in a slightly tweaked form, the politicians are missing the point, since most of them have probably never run a small business. Here are a few points to consider.
- The IRS does have a deadline for printing withholding tables and forms that employers will be using in 2011. With Congress’ continued delaying tactics to score political points, if the publishing deadline is missed to revise the forms, the IRS will be forced to print outdated tables. The losers will be workers who will have higher taxes taken out of their paycheck in 2011 and the government who will have to pay to print the forms twice.
- Business owners do not make spending decisions to hire or invest in their companies when no one knows what the tax laws will be. Investing in companies via equipment and other items means more money in the private sector which has been proven time and time again to be a better economic stimulus than monies spent by government.
- The American voters fired the current leadership last month for not fixing the economy. Obviously the leadership didn’t get the message since they have decided to continue the choice of uncertainty that affects decisions that could improve the economy. See item 2 above.
This article was written by Jay Kossen, CPA at Numerico, PC. Click here to view Numerico’s website.
