Missourians know small and family-owned businesses are the main drivers of our state economy. Small businesses in the Show-Me State account for 99.4% of all companies and sustain roughly 1.1 million jobs, according to a recent report by the U.S. Small Business Administration. This is why it is so disheartening to see Missouri’s Republican Rep. Jason Smith, chair of the House Ways and Means Committee, cave to special interests in pursuit of a tax package, resorting to gimmicks that ultimately come at the expense of Missouri’s small businesses and his own constituents.
Forged in partnership with Democratic Sen. Ron Wyden of Oregon, the tax legislation features elements representing big government at its worst, imposing new burdens and costs that promise to wreak havoc on essential engines of our economy.
Research confirms that small business owners currently face unprecedented challenges. Adding to their worries is the persistent apprehension that the heavy hand of government will only add to their burdens, evidenced by their strong disapproval of how leaders in Washington, D.C., treat them. Amid persistent inflation, which remains at nearly 3.5% in Missouri, consumers rely on small and local businesses as much as ever, on track with a national trend noting that nearly 91% of Americans patronize a small business every week.
As a self-described champion for small businesses, Smith’s bill targets these very businesses with unfair penalties. Specifically, the legislation targets the employee retention tax credit, or ERC, which Smith and Wyden say would save $70 billion.
This is at best some very fuzzy math. As Sen. Thom Tillis of North Carolina recently argued in The Wall Street Journal: “The employee retention tax credit was never paid for to begin with, as it was passed as part of emergency pandemic relief under the Cares Act. Its hasty implementation resulted in massive fraud and cost overruns.” Characterizing the scheme as “phony savings,” Tillis noted, “it’s like paying off a credit-card balance with another credit card. It’s fiscally irresponsible and unsustainable.”
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