Yesterday marked six months since President Barack Obama delivered the 2013 State of the Union address. The speech, which focused mainly on the economic state of the U.S., contained several promises that would affect small businesses owners.
Here's how President Obama has been doing in making those promises come true, as reported by The Washington Post.
Comprehensive Tax Form
Obama: "The American people deserve a tax code that helps small businesses spend less time filling out complicated forms and more time expanding and hiring. ... Now is our best chance for bipartisan, comprehensive tax reform."
Status: Progress, but challenges remain, says The Washington Post.
While small businesses would love to see overhaul of the tax code take place, they are not the biggest fans of the President's current plan. Specifically, they want to see Congress and the president take a firmer stance when it comes to closing offshore tax loopholes.
Tax reform has supporters in Congress--Senate Finance Committee Chairman Max Baucus (D-Mont.) and House Ways and Means Committee Chairman Dave Camp (R-Mich.) in particular. Besides contemplating taking on the project of comprehensive tax reform, Congress is currently sitting on three different tax proposals that could affect small businesses.
Also pending before the House is the Marketplace Fairness Act, which passed the Senate earlier this year. The act, which will allow states to collect sales tax from online retail sales, has met with some resistance from the small online retails, who have been lobbying for Congress to increase the minimum revenue threshold. Large online retailers have also spent some time and money lobbying for passage of the Act.
Obama: "Let’s offer incentives to companies that hire Americans who've got what it takes to fill that job opening, but have been out of work so long that no one will give them a chance."
Status: Not forgotten, but not likely.
The president attempted to follow through on this promise when he introduced a budget that contained:
- a one-time tax credit for companies with $20 million in wages that would hire more workers or raised pay for the current employees
- a permanent tax break for companies that hire returning veterans.
While business groups support both proposals, they are unlikely to pass Congress since Republicans and Democrats continue to struggle to agree on spending cuts and can't seem to pass a long-term budget, notes The Post.
International Trade Partnerships
Obama: "We intend to complete negotiations on a Trans-Pacific Partnership." "We will launch talks on a comprehensive Transatlantic Trade and Investment Partnership with the European Union."
Status: So far, so good.
"In July, U.S. and European officials launched formal talks to create a transatlantic trade agreement that would strip away many hurdles for exporters. Meanwhile, the administration is working on a Trans-Pacific Partnership with about a dozen Asia-Pacific nations, which would be the largest agreement of its kind," reports The Post.
Obama: "Right now, leaders from the business, labor, law enforcement, faith communities--they all agree that the time has come to pass comprehensive immigration reform. Now is the time to do it. ... Real reform means fixing the legal immigration system to cut waiting periods, reduce bureaucracy, and attract the highly-skilled entrepreneurs and engineers that will help create jobs and grow our economy."
Status: Major steps forward, but big hurdles remain.
Currently, the hurdle in question is the House of Representatives. Earlier this year, the Senate passed an immigration bill introduced by the bipartisan Gang of Eight. The bill, which contains increased number of H1-B visas for high-skill workers and mandatory use of E-Verify, has received significant support from the tech industry.
More Manufacturing Hubs
Obama: "I'm announcing the launch of three more of these manufacturing hubs, where business will partner with the departments of Defense and Energy to turn regions left behind by globalization into global centers of high-tech jobs. And I ask this Congress to help create a network of 15 of these hubs."
Status: A more modest expansion.
The president might as well say goodbye to the 15 manufacturing hubs, since Congress is not likely to approve the $1 billion price tage.
However, Obama has not given up completely. The White House has scrounged up $200 million from five agencies, including NASA and Department of Defense, to award to three teams of business and nonprofit organizations, which will then be tasked with creating such manufacturing and innovation hubs.
Higher Minimum Wage
Obama: "Let's declare that in the wealthiest nation on Earth, no one who works full time should have to live in poverty, and raise the federal minimum wage to $9 an hour."
Status: Not much movement.
This proposal has been met with mixed reactions within the small business community.
While the increase will affect small business the most, one recent survey shows that 67 percent of small businesses actually support such a hike and that 85 percent of small businesses already pay their employees more than minimum wage.