The Proposed Health Care Tax on Small Business

The Proposed Health Care Tax on Small Business

Politicians often think that anyone dumb enough to vote them into office will accept dumb tax legislation, as long as voters think the tax will be against the employer, and not them.

Congress has just proposed paying, in part, for universal health care, by forcing every employer to insure its employees. Those with as little as $400,000 annual payroll who don’t, will pay an 8% penalty. The penalty will be 4% for payrolls between $250,000 to $400,000. As I note, this is just a proposal.

Labor is a major cost for most small, non-manufacturing businesses, The net, bottom line often does not exceed 5% or 10%. I know because I operated them. With an added health tax, many entrepreneurs who would love to insure employees when they want to attract them in a booming economy, simply will not be able to afford them.

Is this legislation for a recessionary economy in need of a GENUINE stimulus?