The House Ways and Means committee led by Congressman Dave Camp (R-Midland, MI) approved H.R. 9, the Small Business Tax Cut Act of 2012 late yesterday. The legislation will allow businesses with fewer than 500 employees to take a tax deduction equal to 20% of their active business income and applies to business owners who pay their taxes at the individual or corporate level.
As chairman of the committee, Camp highlighted the immediate impact of the Small Business Tax Cut Act saying, "Whenever I am talking with small business owners in our community, the question I am often asked is, "how can we help spur a climate so the private sector can create jobs?' There is no doubt that comprehensive tax reform that lowers rates and makes the code simpler and fairer is key to achieving that goal. While we pursue comprehensive tax reform that gives businesses of all sizes the certainty they need to invest and hire for the future, we need something that can help small businesses today.
The Small Business Tax Cut Act provides the help that small businesses need right now. This deduction can free up resources so a small business can invest, hire another worker or provide a raise to an employee -- something too many employers haven't been able to do in this weak and slowly recovering economy. Small businesses will be able to take advantage of the deduction immediately in 2012, which can incentivize the job growth we need to help get Americans back to work."
Michigan small business owners came out in strong support of Camp's effort.
Jim Holton, owner of Mountain Town Station in Mount Pleasant, has served the central Michigan community as a restaurant owner for more than 15 years and commented on the ease of the legislation. "I was eager to hear of Congressman Camp's effort, and am very encouraged that his committee has acted swiftly to provide the kind of job-creating environment in the Great Lakes Bay region and America as a whole need so baldly right now. It is my sincere hope that the House will act swiftly and that the Senate will follow and make this legislation a priority."
Majority Leader Cantor has indicated the legislation is expected to come before the House of Representatives for a vote in mid-April, around Tax Day.
"It doesn't matter how you are organized. It is money straight to the bottom line of the small businessman and woman to be able to retain more of the monies earned to be able to invest back in those businesses and create more jobs," said Cantor.