From a cookie business to Congress: Cut taxes now

As Congress prepares to pass tax cuts by a simple majority, small business owners have their fingers crossed.

The Republican plan reduces the small business tax rate—nearly 40 percent for pass-through businesses—to a much fairer 25 percent. This would free up valuable resources for job creation and business expansion, the foundation of economic growth.

{mosads}I’m speaking from experience. As the president and CEO of Joseph’s Lite Cookies in Florida, I run a family-owned sugar-free cookie business dedicated to quality service and even better cookies. We bake more than 12 million sugar-free cookies a day, in addition to supplying other diabetic-friendly products. 

But business would be even better—for myself and other small business owners—with a lighter tax burden. The overwhelming majority of small businesses (95 percent) are considered “pass-through” entities, which means their owners are taxed at the highest individual marginal tax rate. As it stands now, the pass-through tax rate hovers around 40 percent. With state and local taxes included, the pass-through tax burden can reach 50 percent!

After eight years of anti-growth economic policies, tax cuts would have a quantifiable impact. In my home state of Florida, there are 2.3 million small businesses, employing over three million workers. Nationwide, there are nearly 30 million small businesses, employing roughly 60 million workers—half of the U.S. workforce. In fact, small businesses make up 99.9 percent of all U.S. companies, generating over $470 billion in exports every year.

Moreover, their family members depend on the success of small business for career stability and financial security. A tax cut for job creators is a win for the people who depend on them.

I would personally be able to invest in new recipes, which means new employees. I would also be able to raise wages for my current workers, who work hard to bake our famous cookies and serve our hungry customers.  

Congress can look to Florida for guidance. Earlier this year, Gov. Rick Scott signed a $180 million tax cut package focused on small business tax relief. The new law slashed taxes charged on business rent, saving our state’s small businesses more than $60 million a year. This money can now be reinvested into job creation and business expansion.

In the governor’s words: “Every time we cut taxes, we are encouraging businesses of all sizes to create opportunities for families across the state and more money is put back in taxpayers’ pockets.”

He’s right. Now his work must be replicated on a federal level. Americans agree: More than 60 percent of voters support the 25 percent small business tax rate. The American people are generally receptive to the Republican tax package, knowing it will spur economic growth.

Those opposed claim the tax cuts only reward the wealthy, but they fail to understand basic economics. Even “wealthy” entrepreneurs need help hiring employees, raising wages, and financing expansion. Without them, millions of employees are left in the dust. Tax cuts aren’t designed to line the wealthiest pockets; they incentivize job creators to line their employees’ pockets. The latter is nearly impossible with a heavy tax burden.

Congress must move swiftly to alleviate it—for the sake of American workers. 

Joseph Semprevivo is the president and CEO of Joseph’s Lite Cookies in Florida. He is an adjunct professor of finance, real estate, and insurance at Indian River State College and the #1 bestselling and award-winning author of “Madness, Miracles, Millions”.