Anti-tax activist Grover Norquist, who once infamously said he’s like cut government down to the size “where we can drown it in the bathtub,” is publicly endorsing a small business tax cut proposal offered by Sarasota area Republican Rep. Vern Buchanan.
The bill, dubbed the Main Street Fairness Act, would establish that businesses that file taxes as passthrough income – such as sole proprietorships, partnerships, LLCs and S corporations – will never pay a higher rate than a corporation. Under current law, corporations pay a maximum tax rate of 35 percent, while small business owners pay up to 39.6 percent under the individual income tax code on top of additional taxes on earnings and investments. Buchanan says these small businesses pay more than 50 percent of their income in taxes in some states. In Florida, they face an effective tax rate of 42.6 percent, according to the Tax Foundation.
“This important change helps ensure that businesses are on a level playing field for decades to come,” says Norquist, president of Americans for Tax Reform. “A key goal of tax reform should be taxing businesses equally, not discriminating based on arbitrary laws, and Congressman Buchanan’s legislation ensures this becomes reality. Members of Congress should have no hesitation supporting and co-sponsoring this pro-taxpayer, pro-small business legislation.”
Other business groups like the National Association of Manufacturers, Associated Builders and Contractors, the National Retail Federation and the Florida Chamber of Commerce are all backing Buchanan’s bill.
“The goal of tax reform should be to boost the economy and create more American jobs,” said Buchanan in a statement. “Even President Obama has called for reducing our corporate tax rate, but merely reducing the tax burden on corporations does nothing for more than 90 percent of American businesses.”