While Washington attempts to get its political house in order following the midterm elections, which has led to Republican majorities in both the House and Senate, a number of pressing issues linger for small business owners.

Among those, health care, taxes, and regulations rank as the biggest issues they want taken care of, according to numerous polls.

The question is, can a lame duck President at loggerheads with a Republican Congress make any headway?

Here's a quick look at where things stand:

The Budget: First things first, we have to get a federal spending bill passed. A temporary budget extension from October, expires next month. While a government shutdown could loom, some analysts say that would be political suicide for Republicans, who engineered the last one, as they head into the presidential election cycle. When a budget does pass, however, we can expect further entitlement cuts, such as to food stamps, Medicare, and programs such as the arts, or national parks. While these cuts would lead to lower federal spending, which could put the U.S.'s economic house in better order, they could also lead diminished bottom lines of businesses as some consumers may have less money to spend. Additionally, if businesses depend on these programs, naturally, they'll have less to go around too. 

Health Care: Republicans loathe the Affordable Care Act and have made no secret of it. While many in the party would like to revoke the act entirely, that's not likely to happen. The ACA is President Obama's signature achievement, so he'd unquestionably wield his veto pen on that one. But parts of it could be reversed, such as an unpopular medical device tax, forwarded in 2012. Similarly, the employer mandate, which requires businesses with 50 full-time employees or more to provide health care, has proved confusing and onerous to many entrepreneurs. It could be modified or eliminated, according to some analysts. Outside of Congress, the Supreme Court said it will hear a new challenge to the ACA, which involves the way state exchanges operated by the federal government are funded. So expect changes.

Immigration: There's a shortage of qualified workers for leading growth industries such as technology. To address this, businesses--in places like Silicon Valley, where software engineers are in great demand and short supply--want to expand the eligibility rolls for H1B visas for qualified foreign workers. Congress wasn't able to come to an agreement on immigration reform last year, as Republicans shelved a bipartisan bill from the Senate. A Republican-led Congress may be able to make more headway in the next two years, some experts theorize, although that would likely mean more border policing.

Keystone XL Pipeline: The controversial, $8 billion pipeline would deliver oil from Canada's tar sands to the Gulf Coast of the U.S. Proponents say it would lower the price of oil and create jobs and new business opportunities at home. Opponents, including the President say it would contribute to climate change and cause other environmental damage. The House plans to vote on the pipeline as early as Friday. The Senate, pushed by Mary Landrieu (D., La.) could vote on it soon after.

Taxes: Our tax system is a confusing mess and needs updating. And we could be approaching a grand bargain on corporate and individual taxes, such as was last seen the 1980s under then-President Ronald Reagan. Both parties are actually not that far apart on taxes, experts say, with Democrats wanting to close loopholes and Republicans pushing to lower taxes for the wealthy and for corporations. A comprehensive blueprint for tax reform has already been crafted by outgoing chairman of the Ways and Means Committee, Dave Camp (R., Mich.) The plan would lower the top corporate rate to 25 percent from its current 35 percent, and it would reduce and simplify taxes for individuals as well. Since millions of small businesses are formed as S Corps and LLCs, which are taxed at the individual owner level, that could be good for them.

Small businesses also want to extend about 50 tax breaks, called extenders, that expired last year, including for research and development, investment and depreciation.

You could also see legislation emerge on the long-stalled issue of states' ability to charge Internet sales taxes. The Marketplace Fairness Act, which passed in the Democratically controlled Senate last year, and which stalled in the House, would have allowed states to tax sales of online businesses, even in states where such businesses don't have physical locations. Currently states can charge sales tax on Internet sales only if businesses have a physical location there. Speaker of the House John Boehner (R., Oh.) has vowed to crush any new legislation on the matter. But Senator Harry Reid (D., Nv.) has said he plans to make it a priority after the midterms. 

 

 

Published on: Nov 13, 2014