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Washington Watch
September 17, 2003
New Small-Business Coalition
Fights to End Tax Disparity for the
Self-Employed
As Washington focuses on the needs of entrepreneurs
during the U.S. Small Business Administration’s 50th
anniversary celebration this week, a new coalition of
small-business trade associations joins together to
fight a discrimination within the tax code forcing
self-employed Americans to pay an extra 15.3 percent
in taxes on their health coverage costs every year.
Spearheaded by the NASE, the Equity for Our Nation’s
Self-Employed coalition includes 16 of the nation’s
leading small-business groups and organizations. The
grassroots movement will focus on redressing federal
policy that taxes sole proprietors 15.3 percent on
their health insurance costs.
Current tax law requires sole proprietors to pay 15.3
percent in self-employment tax (FICA tax) on their
health insurance premiums, while larger businesses are
able to deduct the expense as a regular cost of
business. Equity for Our Nation’s Self-Employed
supports
H.R. 1873, the Self-Employed Health Care
Affordability Act, to correct this disparity.
Seventy percent of the self-employed surveyed say they
cannot afford basic insurance coverage. Of the
estimated 41 million Americans without health
insurance today, 60 percent –24 million– are from
families in which the head of household is
self-employed or working for a small business. On
average, workers in tiny firms pay 18 percent more for
health insurance than their counterparts at larger
firms. Access to affordable health care is cited as
the leading issue of concern to small businesses.
The average self-employed individual pays $9,068
annually in health insurance premiums for family
coverage, according to a 2003 Kaiser Family Foundation
study. Under the current tax code, this sole
proprietor would pay $1,387 (15.3 percent) in
self-employment taxes on this amount while other
business entities can fully deduct their health costs.
For more information on the self-employment tax on
health insurance premiums, or H.R. 1873, visit
www.taxequity.org.
NASE Works to Counteract New
Statistics on Skyrocketing Health Premiums
New figures were released on the cost of health
care last week, and the outlook is bleak: private health
insurance premiums increased 13.9 percent in 2003, a larger
increase than last year and the third consecutive year of
double-digit increases, according to the Kaiser Family
Foundation and Health Research and Educational Trust.
The NASE continues to work to counter skyrocketing health
insurance premiums, through member benefits, business advice
and policy advocacy. This week, the NASE participated in the
U.S.
Chamber of Commerce and
National
Women’s Business Council Health Care summit, as well as
the U.S. Small
Business Administration’s Small Business Week.
Eliminating the self-employment tax on health insurance
premiums took center stage with the announcement of the
Equity
for Our Nation’s Self-Employed coalition.
NASE Director of Government Affairs Kristie Darien discussed
the problem and the NASE-supported solutions on a new
Internet radio station with other health care experts this
week. Listen to an archive of the program at
http://www.btiradio.com.
Small Business Week Honors America's
Entrepreneurs
The U.S. Small Business Administration hosts “National Small
Business Week” this week, honoring America’s entrepreneurs,
and providing a forum for networking and business
matchmaking opportunities.
As part of the SBA’s 50th Anniversary celebration, Small
Business Week brings together thousands of micro-business
owners, policy-makers and legislators to focus on the needs
and accomplishments of small business. The NASE is a proud
sponsor of the celebration, and encourages members in the
Washington, D.C. area to participate in the remaining
activities.
“The entrepreneurs who own and operate America’s small
businesses are an indispensable factor in America’s economic
strength,” President George Bush said this week. “These
entrepreneurs possess many of the characteristics that
define the American spirit – innovation, dedication, and
drive. America’s small businesses are forging new
opportunities and prosperity for America. Their tremendous
spirit is an example to us all. Leading by example,
America’s entrepreneurs have made, and continue to make, an
indelible mark on our economy.”
For more information on National Small Business Week, or any
of the SBA 50th Anniversary local celebrations, visit
http://www.sba.gov/50.
Minority Business
Exchange in Washington, D.C.
As part of the Congressional Black
Caucus Foundation’s Annual Legislative Conference, the
Minority Business Exchange will bring together resources
from the private and public sectors to assist small and
minority owned businesses and entrepreneurs next week in
Washington, D.C.
The free event serves to provide minority business owners
and entrepreneurs with the direct assistance necessary to
start or grow their business from federal procurement
officers, venture capitalists, bankers and business resource
experts. Find out more about the Minority Business Exchange,
Friday, September 26 at the Washington Convention Center, at
www.cbcfinc.org.
Do any of these issues affect you? Do you want to be
proactive in helping the micro-business community? Visit the
NASE Legislative Action Center and be a
Micro-Business Crusader.
Members of Congress appreciate hearing from their constituents.
Letting your legislators know how you feel on an issue puts
strength behind the NASE legislative agenda.
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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