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Washington Watch
May 21, 2003
NASE Testifies to
Overwhelming Regulatory Burden on Micro-Businesses
Last week, the NASE testified on your behalf, telling
the
House Small Business Subcommittee on Regulatory
Reform and Oversight that regulatory burdens often
overwhelm the self-employed and micro-businesses.
“The burden imposed on micro-business is
disproportionate to that of larger businesses,”
Kristie Darien, NASE director of government affairs,
said, “because smaller firms cannot spread the
overhead costs associated with hiring accountants and
attorneys, and the general cost of paperwork and staff
needed to comply with the maze of federal
regulations.”
Small businesses face a regulatory burden 60 percent
higher per employee than large businesses, according
to a report by the U.S. Small Business
Administration’s
Office of Advocacy. A small-business
owner pays almost $7,000 per employee in regulatory
compliance costs each year.
At the hearing on federal agency treatment of small
business, the NASE commended recent efforts by the
Internal Revenue Service to be more small-business
friendly. But, Darien said, the self-employed and
micro-business communities still face an overwhelming
regulatory burden in complying with IRS regulations
and enforcement.
“It’s more of a problem with the regulations, not
necessarily the regulators,” she said. Darien pointed
to the complex checklist micro-business owners use in
order to determine if someone is an employee or an
independent contractor.
If you have a story about how federal regulations
affect your business, or to
read Darien’s testimony,
visit the NASE at the
Legislative Action Center.
Kristie Darien, NASE Director of Government Affairs,
testifies before the
House Small Business Subcommittee
on Regulatory Reform and Oversight
House and Senate Members to Finalize Economic Stimulus
Package
As our nation’s economy creeps along, the legislators in the
House of
Representatives and the
Senate
recently passed two competing versions of an economic growth and
stimulus package, both similar to the
Bush Administration’s proposal earlier this year.
Each of the versions includes provisions regarding dividend tax
relief, a child tax credit, marriage penalty tax relief,
acceleration of income tax rate reductions, and increases in
business equipment expensing and depreciation schedules. Where
the proposals differ is in cost and dividend tax relief
provisions. The House bill will cost $550 billion while the
Senate version would have a price tag of $350 billion.
Two key provisions in both economic growth packages important to
micro-business owners and NASE Members are the acceleration of
individual income tax rate reductions and the increases in
business equipment expensing. Accelerating the income tax rate
reductions would free up capital that the self-employed and
micro-business owners can reinvest in their business. Increases
in Section 179 business equipment expensing would allow
micro-business owners to invest in equipment and technology that
will assist them in effectively running and growing their
business.
Currently, the House and Senate are discussing how to proceed
with ironing out the differences between the two economic growth
proposals. The debate is sure to be an uphill battle with the
Senate holding firm to their $350 billion dollar limit on the
final bill. The hope was to have a final version by the Memorial
Day holiday but that looks unlikely. The NASE will keep you
informed of the status of the economic growth and stimulus
debate.
Please go to the NASE
Legislative Action Center to contact your Members of
Congress on this important issue.
Office of Advocacy Seeks Input on Research Topics
In an effort to provide useful
research and statistical information on small businesses,
the Office of
Advocacy of the U.S. Small Business Administration elicited
expert opinions at a roundtable discussion in Chicago last week.
The roundtable was the first of ten such focus groups planned
for this year across the country, to be attended by small
business academics and researchers.
“We are holding regional focus groups so that our research
products adequately reflect the needs of academics and policy
makers,” said Dr. Chad Moutray, chief economist for the Office
of Advocacy. “We want our reports and data to be an integral
part of academic research.
The Office of Advocacy produces research on a variety of
small-business topics, detailing the importance of small
businesses to the American economy, reporting on policy issues
important to them and describing group characteristics.
Highlights include reports focusing on the characteristics of
small-business employees, effects of tax rule changes, the
impact of contract bundling on small businesses and the usage
and expansion of electronic commerce for small businesses.
The next regional focus group will be held in Washington, D.C.,
on Friday, May 30.
More Important SBA Dates:
Business Matchmaking and Ombudsman Hearings
The U.S. Small Business
Administration Business Matchmaking program brings together
small businesses with federal, state and local government
agencies and large corporations that have actual contract
opportunities to award procurement contracts. First launched
last year by the SBA, and now in partnership with the
U.S.
Chamber of Commerce and
HP, the matchmaking events are being
held regionally:
- Midwest Region, Chicago, Illinois, June 17-18;
- Southeast Region, Birmingham, Alabama, July 31; and
- East Region, Washington, D.C., Sept.19.
For more information on the events, visit
http://www.businessmatchmaking.com/.
The U.S. Small Business Administration National Ombudsman,
Michael Barrera, announced the following meeting schedule for
the second quarter of 2003. The NASE encourages its Members to
attend meetings near them, especially if you have had a problem
with specific excessive regulatory enforcement actions by
federal agencies. Check the National Ombudsman Website at
http://www.sba.gov/ombudsman/ and look under “Events” for
registration information and new announcements:
- Minneapolis, Minnesota, June 12;
- Cedar Rapids, Iowa, June 16;
- Boise, Idaho, July 10;
- Anchorage, Alaska, July 15.
Do any of these issues
affect you? Visit the NASE
Legislative Action Center and “Tell Your Small
Business Story.” This will help the NASE understand -
on a personal level - how key legislative issues are
affecting your business and your bottom line.
For more information about any of the articles in
Washington Watch, contact Maureen Petron, NASE public
affairs manager, at (202) 466-2100 or
mpetron@nase.org.
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