2Center or American Progress | Cantor’s “Small Business” Bill is a $46 Billion Loophole or the Rich
HR 9 is a giant windfall for the very wealthy, not an incentivefor small business job creation
Under Rep. Canor’s bill, in general, all businesses wih ewer han 500 employees areeligible or he ax deducion on heir acive domesic income. Te erm “small business”evokes images o mom-and-pop sores or sarups hoping o expand, bu in ac a very widerange o enerprises owned by exremely wealhy people have ewer han 500 employees.Tese businesses and heir owners would reap a gian windall rom he Canor bill. An exchange during he House commitee’s consideraion o he bill beween Rep. Xavier Becerra (D-CA) and Tomas Barhold, who heads Congress’s nonparisan Join Commitee on axaion, underscored ha Rep. Canor’s ax cu could poenially provide large windalls o he owners o a hos o enerprises ha are a ar cry rom heimage Canor ries o evoke o he sruggling small-business owner. Tese include:
Proessional spors ranchises, such as he Los Angeles Dodgers, which were recenly sold or $2 billion
Donald rump’s rump ower Sales & Leasing
Paris Hilon Enerainmen, Inc.
In addiion o he owners o enerprises like hese, he Canor bill would provide asizeable ax cu o many highly paid proessionals, including lawyers, lobbyiss, docors,sockbrokers, hedge und managers, and oher nancial indusry proessionals. Tese well-compensaed proessionals are among he leas in need o a ax cu—and alsounlikely o use he exra cash rom a ax cu o expand operaions or hire ohers.
As oneeconomis asked when discussing he Bush ax cus, “Should we give he hedge undmanagers millions o dollars o ax relie on he possibiliy ha hey migh hire anoheroce assisan?”
Te same quesion should be asked o Canor’s bill.
Half of H.R. 9’s tax cuts go to millionaires, not to business owners whowould most benefit from a tax break
An analysis by he nonparisan ax Policy Cener shows ha he Canor bill is exremely skewed oward he wealhy. People wih annual incomes above $1 million would receivenearly hal o he bene rom Canor’s bill, even hough hey comprise less han one hal o 1 percen o all axpayers.
Tey also comprise a small percenage—jus 4 percen—o small-business employers, according o a recen reasury Deparmen analysis.
In ac, 76 percen o small-business employers have incomes below $200,000. Buha group receives only 16 percen o he bene rom Canor’s bill. And 55 percen o small-business employers have incomes below $100,000, bu ha group receives only 6percen o he bene rom Canor’s bill.