Small business owners, like so many Americans, are anxiously waiting to see whether Congress can avoid potentially catastrophic spending cuts and tax code revisions scheduled to take place at the end of the year. But already, just the threat of toppling over the tax cliff is weighing on their decisions and bottom lines.
In fact, perhaps more than any proposed avoidance maneuver, it’s the overwhelming sense of uncertainty surrounding the months ahead that has small businesses stuck in a holding pattern, discouraging them from hiring and delaying investments that could help them grow, according to several business owners who testified on the Hill on Thursday.
While most of their concerns centered on the pending expiration of the Bush-era tax cuts, particularly the fate of those cuts for high-income earners, one employer explained that tax changes could hit small business owners from a number of angles.
“Multi-year planning and the ability to predict or at least estimate business profits and taxes are critical in operating a business, and it’s important to know both the current and future tax rates,” Jeffrey Porter, owner of Porter & Associates in Huntington, W.V., told members of the House Small Business Committee, later adding that “unfortunately, the uncertainty is not limited to one or two provisions, but instead affects many areas of the internal revenue code.”