Small Business Credit Goes to…Less than 2%
The Washington Post has an article this morning discussing a Commonwealth Fund study about the impact of health “reform” on small business. While the study attempts to trumpet the claim that 16.6 million workers are employed by small businesses eligible for the tax credit created by the law, the reality is that the credit’s impact will be much smaller. An estimate developed for Commonwealth by paid administration advisor Jonathan Gruber found that only 3.4 million workers are in firms that will actually receive the credit between now and 2014. According to the Census Bureau’s population estimates, that means that only 1.1% of all Americans, and 1.7% of those with private health insurance, will receive any benefit from the small business tax credit — a paltry showing by most measures.
Full post by Republican Policy Committee Analyst Chris Jacobs here.
The program is only temporary. In addition, the credit phases out as the number of workers approaches 25 and as average wages for all workers approaches $50,000. In other words, even those that qualify for a subsidy will likely find it provides only modest benefits.
Most of my smaller clients are not even eligible for the credit since they are above the $50k in earnings. The Small business tax credit is a joke. My clients even laugh.
The Commonwealth Fund is as shameless as Nancy-Ann DeParle (see the post above). Sorry to see Gruber shilling for all these people.
The small business tax credit exists to provide a cover and a useful talking point. It obviously wasn’t designed to do anything else.