Tax overhaul would create Va. jobs
By John Sims
Congress is close to crossing the finish line on providing small business tax cuts, relieving the overdue financial burden on millions of small business owners.
As the owner of Rainbow Station in Richmond, I know tax cuts for small businesses will ensure prosperity for many years to come.
The Tax Cuts and Jobs Act currently making its way through Congress finally puts small businesses first, significantly cutting taxes on more than 700,000 small business here in Virginia. The current and outdated tax code treats most Main Street businesses as “pass-through” entities, meaning a small business’s taxable income is passed on to the owner and is subject to be taxed at the individual’s highest marginal income tax rate, which could be nearly 40 percent on the federal level.
When you combine that with state and local taxes, it adds up to almost half of the owner’s income.
The Senate bill passed last week will lower individual tax brackets and allow for small businesses that make under less than 500,000 (which is 97 percent of all small businesses) to claim a 20-percent tax deduction. Additionally, the bill also doubles the regular standard deduction for individuals and joint filers.
When put together, these provisions are huge and will provide substantial savings for small business owners, the backbone to Virginia’s main streets.
In Virginia alone, small businesses employ nearly half of the workforce and impact almost everyone in the state. The Tax Cuts and Jobs Act will allow Virginia’s small businesses to keep more of their profits, allowing small business owners to reinvest back into their company.
And according to a study by the Job Creators Network, a majority of small business owners surveyed expressed that they would also reinvest their savings into new jobs, higher wages or expansion.
As a small business owner for almost five years now, I couldn’t agree more. I would use this additional tax savings to hire more staff and give my employees a much-deserved raise. My wife and I have even discussed opening another location if we had the funds.
Job creation is a passion of mine. As owner of an early childhood education and school-age recreation facility for children, I must ensure the health and safety of more than 200 children every day. Their futures mean as much to me as my own kids’.
I want to know that these children are growing up in a world where they won’t have to worry about finding a job at any point in their life. This small business tax cut would allow me the opportunity to further invest in children’s education instead of Washington bureaucrats.
Above all else, a less burdening tax code leads to job creation and more jobs for everyone. A Tax Foundation study found that more than 25,000 additional jobs would be added to Virginia’s economy over the period of 10 years. These additional jobs would ensure economic opportunity for generations to come.
It’s been more than 30 years since a major tax overhaul happened, and small businesses are anxiously awaiting their long overdue tax cut. Right now, the last step is for Congress to send a final bill to President Trump to sign, ensuring small businesses tax cuts for a more prosperous Virginia.
John Sims is the owner of a Rainbow Station childcare franchise.