NFIB: Small businesses want simpler code, lower taxes

By Bernie Becker - 03/07/13 12:32 PM ET

A prominent small-business advocate says its members want tax reform to both simplify the code and lower their taxes.

The National Federation of Independent Business found in a survey that more than eight in 10 owners want Washington to overhaul the tax code, and a similar percentage want policymakers to rely on spending cuts rather than revenues to reduce deficits.

Seven out of 10 owners also believe that any tax code rewrite should lower their tax burden, and survey respondents said that the current code offers inconsistent preferences and doesn’t let them plan for the future.

“By an overwhelming margin, small-business owners indicated that they prefer lower individual tax rates and a simpler tax code,” William Dennis, a senior research fellow at NFIB, said in a statement. “They see economic possibility in growing their businesses, not in growing government revenue through tax increases."

“This survey clearly shows that small-business owners believe the tax code is too complicated, too politically motivated, and inconsistent,” added Chris Whitcomb, NFIB’s tax counsel. “It is no wonder that more than half of small businesses believe that simplifying the tax code should be a top priority.”

Top officials on both sides of the aisle are pushing to overhaul the tax code, with House GOP leaders having promised prime legislative real estate, H.R. 1, to a reform package that Ways and Means Chairman Dave Camp (R-Mich.) has vowed to pass out of his panel.

Senate Democrats have also considered placing instructions in their upcoming budget that could pave the way for tax reform.

Still, the two parties remain divided over whether tax reform should help eat into deficits.

During last year’s "fiscal cliff" debate, Republicans said allowing individual tax rates to rise on the highest earners would hurt small businesses, many of whom pay through the individual code. Democrats countered that a higher top rate would only affect a small percentage of businesses.

In the end, the fiscal-cliff deal allowed the top rate to rise from 35 percent to 39.6 percent.

NFIB also opposed any federal effort to raise the minimum wage, and was a key plaintiff in the legal challenge to the Democratic healthcare overhaul.