Senate Advances Small Business Aid Package
The Senate on Tuesday advanced legislation to aid small businesses but failed to relieve them of burdensome new tax filings.
Two retiring Republicans joined Democrats in voting to move the bill, which includes a $30-billion loan fund and other tax breaks for small businesses. The bill's clearing of the procedural hurdle all but guarantees the Senate will pass it later this week. The House, which already approved similar legislation in June, is expected to then approve the measure promptly.
But neither party could string together the 60 votes needed to repeal or soften a new tax-reporting requirement that would force small businesses to notify the Internal Revenue Service of every purchase of goods valued at more than $600. There were two proposed amendments regarding the requirement, which is part of the health care reform passed in March.
"I have never seen it like this," National Small Business Association president Todd McCracken, who has been lobbying Congress for more than two decades, told the Los Angeles Times. "It is what makes small-business owners feel like their heads are going to explode."
The aid package of tax breaks and other incentives includes a $30-billion loan fund, which would be administered by the Treasury Department, that would go to qualified community banks that promise to extend new loans to small businesses. Another $12 billion in tax breaks would let businesses write off more of the cost of buying new equipment and making improvements – the expensing limits would be increased to $500,000. Those who are self-employed could deduct health care costs. The bill would also extend a popular program – originally created by the American Recovery and Reinvestment Act in February 2009 – to help small businesses get loans at more favorable terms.
President Barack Obama welcomed the vote. "This is a bill that would cut taxes and help provide loans to millions of small-business owners, who create most of the new jobs in this country," he said in a statement. "Small businesses across the country have been waiting for Washington to act on this bill for far too long." (Obama also took a dig at Republicans, accusing them of staging a "months-long partisan blockade.")
John Arensmeyer, president of the left-leaning Small Business Majority, said, "This bill will do more to support small business than any bill has in years."
Nevada Democrat and Senate Majority Leader Harry Reid praised Republican Senators George Voinovich of Ohio and George LeMieux of Florida for their support. He called the bill "the most significant thing we have done since the stimulus bill was passed to create jobs."
LeMieux told The New York Times the bill was needed desperately.
"It's going to pass," he said moments after the procedural vote. "It's the right thing to do. It's going to be very good for my state. We have got almost two million small businesses. They are struggling. I visited businesses over August, and they can't get financing."
Inc. contributing editor Courtney Rubin was for five years a London-based staff writer for People magazine. Rubin, a former senior writer for Washingtonian magazine, has written for the New York Times magazine, Time, Marie Claire, and other publications. She is the author of The Weight-Loss Diaries.