Small-business owners push for tax increases

2012-12-05T22:30:00Z 2012-12-06T08:29:04Z Small-business owners push for tax increasesBy TOM LUTEY tlutey@billingsgazette.com The Billings Gazette

Should his senators need a “Joe the Plumber” type figure to testify about raising taxes, Billings small businessman Gary Mermel is ready.

“We want them to know we’re out here, should they need that ‘Joe the Plumber’ moment, we're their guys,” Mermel said Tuesday after he and other members of the Montana Small Business Alliance delivered their fiscal-cliff recommendations to the offices of U.S. Sens. Max Baucus and Jon Tester in Billings.

Joe “The Plumber” Wurzelbacher became a 2008 Republican campaign celebrity after questioning then-candidate Barack Obama about the Democrat’s economic policies. Overnight, Wurzelbacher became a symbol of American small-business owners worried about being buried by taxes and regulations.

Mermel could be Wurzelbacher’s mirror opposite. He and other Montana Small Business Alliance members support ending tax cuts for Americans making more than $250,000 a year, as well as raising the corporate income tax by 4 percent. Congress is attempting to cut deficit spending through tax increases and spending cuts by year’s end. If it doesn't, automatic tax increases and spending cuts will be triggered. Many economists say the automatic tax increases on household incomes, coupled with a sudden decline in the amount of business the government does with private companies, will send the economy back into recession.

Small Business Alliance members also support removing the $110,000 income cap on how much payroll and salary revenue can face Social Security deductions. Social Security shouldn’t be cut, not only because seniors depend on the income but also because smaller Social Security payments mean smaller sales at local businesses, they said.

“Small-business owners do have a voice, and unless they stand up their voices aren’t going to be heard,” said Rita Plouffe, who owns Roots Botanical in Billings. “It seems like a lot of small businesses aren’t heard because of the large corporations lobbying to get what they want.”

Ending tax cuts on household incomes greater than $250,000 won’t hurt most Montana small-business owners, Plouffe said.

Mermel said businesses doing even $1 million a year in business don’t have owners with $250,000 a year in income. Mermel doesn’t pay taxes on his gross business earnings. After all his expenses are deducted, his 10 percent profit on Qdoba Mexican Grill in Billings is less than $250,000. He would have to sell $2.5 million worth of burritos and tacos to raise his personal income to $250,000.

In Montana, 98.65 percent of the state’s taxpayers make less than the $200,000 to $250,000 being targeted by Democrats for a tax increase, according to the Montana Department of Revenue. Republicans object to tax increases targeting wealthy Americans.

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