New Survey Shows Small Businesses’ Confusion Over Impact Of New Tax Law Holding Back Growth
Through a coalition called Parity for Main Street Employers (PMSE) and other partners, the Metals Service Center Institute (MSCI) advocated last year for tax reductions and simplification for non-C corporation businesses. While the Tax Cuts and Jobs Act (TJCA) signed into law last year will reduce the tax burden for most small businesses, those tax policies will expire within a decade.
As demonstrated by a new PMSE report, they also are highly confusing.
PMSE last week released findings from a survey of 200 pass-through businesses outlining their initial reaction to the TCJA. The survey indicated the tax relief promised to non-corporate employers will be in jeopardy if the U.S. Treasury Department and the Internal Revenue Service do not provide clear guidance on how to implement the new policies. Key results of the survey include:
- Half of the businesses said they are still unsure whether their tax burden would go up or down under the new tax law.
- More than one-third of respondents said they are unsure if they will get the new pass-through deduction.
Click here to read the full survey.
Coalition Executive Director Chris Smith said, “Our survey shows that Main Street Employers are frozen by uncertainty over the new tax law … Nearly half the companies surveyed still don’t know how the law will affect them or if they will qualify for the new deduction. This uncertainty is curbing the law’s ability to increase job growth and investment. The survey reinforces the importance of Treasury issuing timely, well-constructed and pro-growth rules to implement these provisions.”
The Treasury Department and the Office of Management and Budget currently are working on regulations that will hopefully provide additional clarity to pass-through companies. Stay tuned to Connecting the Dots and the PMSE website for information on those rules.