In Illinois’ Third Congressional District, small businesses make up roughly 80% of our overall economy. They are our primary source of goods, services, and employment. They are the backbone of our community, yet they are frequently overlooked by politicians in Washington.
In Congress, I will spotlight the obstacles faced by small businesses and fight for effective solutions.
Problems Faced by Business Owners in IL03
1) An Unfair Tax Code
While businesses with under $10,000,000 in revenue struggle with the burdens of federal income taxes, businesses reporting to make billions of dollars are paying virtually nothing. This uneven playing field makes it impossible for small businesses to compete with large corporations who can afford expensive legal teams and compliance consultants to exploit tax loopholes. In fact, 85% of small business owners agree that our tax code unfairly benefits large corporations. Additionally, for the smallest businesses, revenue is often indistinguishable from the owner’s income. Therefore, this money becomes essentially double-taxed, making it harder for small businesses to sustain themselves. It’s time that we fought for Main Street not Wall Street.
2) Difficulty obtaining loans
Since the passage of Dodd-Frank, community banks have been virtually unable to loan money to small businesses. This unintended consequence of Dodd-Frank has created a huge barrier of entry to would-be small business owners and has stifled growth on Main Street.
3) Providing health care
Health care is a major expense for small employers. Without federally funded health care, employers are often forced to choose between the health of their employees and the success of their business. It is unfair to put small businesses in this position.
4) Lack of assistance from either party
Despite the urgency of these issues, both parties frequently ignore the plight of small businesses. It is time that we prioritize their policy needs in Washington.
Recategorize Mom-and-Pop Shops as Micro-Businesses
We must be more specific in our business classification. Mom-and-pop operations with 9 or less employees need different regulations than larger small businesses to allow them to succeed and grow. We should recategorize them as “micro-businesses” to better address their specific needs. By making this distinction, micro-businesses will not be burdened by regulations designed for much larger entities.
Provide Tax Relief
In order to stop overtaxing small businesses and under taxing large businesses, we should focus on shifting the tax burden. The biggest priority is to recalibrate the tax code so that small businesses are no longer overtaxed and large businesses pay their fair share. The most immediate necessary change to the tax code must be to repeal the Trump Tax Plan which has exacerbated the disproportionate tax burden. Furthermore, older loopholes in the tax code must be amended to ensure that large businesses are taxed on their income. We must also ensure that micro-businesses are not double-taxed on their profits, both as a business and as the personal income of the owners. The loss in federal revenue from small businesses will be balanced by the increased revenue from large businesses. This will allow for growth in the private sector through small businesses without stifling the government’s ability to function.
In addition to inequitable taxation, small businesses are also hurt by their inability to obtain loans. By revising Dodd-Frank to empower small community banks to loan money, small businesses will have more access to essential funds. These loans will allow small businesses to grow and will benefit the job sector and the economy.
Medicare for All
Despite the desire to provide health care for employees, it is simply too expensive for many small businesses. A universal healthcare system will eliminate the obstacle of employer provided health care and allow our small businesses to allocate their money elsewhere.
Investing in Green Businesses
We need to make more funds available through grants and funding to small businesses that provide green technologies or renewable energy. It is essential to prioritize businesses that can help us convert our energy use away from harmful industries. Through additional government funding, we will be able to spark significant strides in green technology. By doing so, we will be investing in a greener economy while supporting our small businesses.
By investing in more than just our small businesses, but also health care for all and green technologies, we can build an economy that works for everyone.