The Fall Small Business Owner Report (SBOR) from Bank of America shows that while small business owners are generally optimistic, there’s a downward trend of individuals who expect to grow their business – even from just this spring.
This trend may not be surprising given the heated political environment and the concerns that, despite the rhetoric about the importance of small business in the economy, policies to help small businesses thrive rarely follow suit.
In the SBOR, the two biggest economic concerns impacting business owners weren’t things like consumer spending or even credit availability—no, the top issues were healthcare costs and corporate tax rates, with the latter at a slight increase from just a year ago.
Not entirely coincidentally, those issues have been at the heart of important yet stalled legislation over the past year. This means that government could, with the right focus and guidance, truly help small businesses create more optimism and, ultimately, growth.
While most small business owners will tell you that they’d just prefer government to get out of the way, here are a few of the top ideas government could implement to address those top small business economic concerns, as concisely laid out in the SBOR:
Free Market Approach to Healthcare: I’ve said many times that the solution to fixing healthcare is to address the costs via transparency and choice. In terms of healthcare insurance, we need coverage that’s available to all, that’s cost effective, and ensures quality care. This requires a free market approach to healthcare where individuals and families can buy nationwide. It also means reducing the burdens on business. You shouldn’t have to depend on an employer to get great insurance, and you—as a small business owner—shouldn’t fear growth because you will be inundated with extra costs. These fixes will allow small businesses in particular to focus more on growth and hiring.
Give All Small Businesses a Real Tax Break: Small businesses outnumber big business by a huge margin (around 28 million vs. less than 15,000), but the big businesses are in for the big tax breaks. And, recent proposals that theoretically offer a small business tax holiday come with a big asterisk in the form of so called “guardrails.” Millions of professional service providers and solopreneurs could face no tax break and also lose deductions. Treat the small businesses as the real economic and hiring engine that they are and more growth will be the obvious outcome.
Create Small Business Tax Hiring Incentives: Not only should small businesses get a tax break, but creating an incentive—such as tax holidays for a new employee’s salary for the first year—would take the risk out of hiring and allow small businesses to get the personnel required to grow. If just 5% of the small businesses in this country were to hire their first employee, that would be one million new jobs available!
Keep Creating Pressure to Lighten Regulations: Finally, make it easier for small business owners to be in business. While much of the red tape is at the local level, everything from confusion over independent contractor definitions to having to get worker’s compensation insurance for work-from-home employees in some states makes it hard to be a business owner. Let business owners focus their time on running their businesses – and growing.
Although the these changes would be ideal for small businesses and perhaps increase owner's optimism in business growth, it's important to remember change doesn't happen over night. For now, I suggest learning a few ways to grow your business.
Related article: Top 10 Overlooked Tax Deductions for the Self-Employed
Related page: 5 helpful tips for tax season
About Carol Roth
Carol Roth is the creator of the Future File ® legacy planning system, “recovering” investment banker, billion-dollar dealmaker, investor, entrepreneur, national media personality and author of the New York Times bestselling book, The Entrepreneur Equation. She is a judge on the Mark Burnett-produced technology competition show, America’s Greatest Makers and TV host and contributor, including
of Microsoft’s Office Small Business Academy. She is also an advisor to companies ranging from startups to major multi-national corporations and has an action figure made in her own likeness.
Bank of America, N.A. engages with Carol Roth to provide informational materials for your discussion or review purposes only. Carol Roth is a registered trademark, used pursuant to license. The third parties within articles are used under license from Carol Roth. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.
Bank of America, N.A. Member FDIC. ©2017 Bank of America Corporation