Tint Talk by Kat Coig
by Kat Coig
November 30th, 2016

The Catch-22

It’s been a few weeks since the President-elect was announced, and media outlets, including social sites, are still being convoluted with “he said, she said,” banter (at least from my own experiences). But, whether your candidate of choice was elected or not, new regulations are headed our way. And I think it’s time to put the focus on Trump’s policies and what they could mean for small businesses, namely his proposed tax plan.

The Breakdown

With the GOP having the majority in Congress, there’s a good chance that Trump’s policies will be passed. So here’s a run-down of his proposed tax reform—which promises to be the biggest tax cut since Reagan came to Washington in the 1980s, according to NPR.

Trump plans to condense the current seven tax code brackets to just three while also providing some major tax reliefs across the board. He intends to slash top earners’ taxes from 39.6 percent to 33 percent, and reduce corporate tax to 15 percent, for both big and small businesses, in hopes of spurring growth and investment. That’s less than half of what some small businesses are taxed now.

Jamil Bouchareb, Co-CEO of Restaurantware reports, “Small businesses can be taxed as much as 39.6 percent of their revenue. This excruciatingly high tax rate slowly kills small companies by limiting their ability to expand. Trump’s tax plan reduces the crazy tax rates on all businesses to 15 percent.”

Trump also believes that by capping taxes at 15 percent, more businesses will remain in the U.S. and not move their headquarters overseas to avoid a high tax rate, at least according to his website.

NPR, quoting Stephen Moore, a senior economic advisor to Trump, says, “… the Trump proposal also would allow businesses to immediately write off the cost of investments, rather than deducting them over a period of years.”

This, Moore believes, will cause businesses to flourish because there will be “more business investment, which will boost worker productivity, wages and growth.” The end result will be more tax revenue which will make up for what revenue could be lost by the proposed tax breaks.

Counter Argument

Naturally, there’s opposition to Trump’s proposed tax plan—while some insist it will be the champion of small businesses, others argue it will end up hurting the economy and possibly favoring the top earners.

Robert Brooker, owner of the 40-employee company WIN-911 located in Austin, Texas, says he’s opposed to Trump’s tax plan in an article published by the website Fortune.

“We have a more balanced society where things are today than with the dramatic decrease of taxes proposed by Trump,” says Booker.

Others claim high-income earners will utilize loopholes by transforming themselves into contractors, claiming to be a one-employee business, according to an NPR report. Workers would send an invoice rather than collect a paycheck, allowing the owner to pay the 15 percent rather than the 33 percent tax rate.

The report also claims, “The Tax Policy Center estimates that if half of American wage earners making over $100,000 a year adopted this strategy, it would cost the U.S. government more than $650 billion in lost tax revenue over 10 years.”

Moore, who helped develop the tax plan, says the Trump administration is going to try and shut those loopholes to ensure top earners can’t scam the system.

In the Meantime

Of course there’s no way to know what policies will be implemented when the President-elect takes office, but it’s important to know the reality of what your window film business may face in the near future.

And if you haven’t already, be sure to take our poll on the homepage of WindowFilmMag.com; we want to know your thoughts on if your business will be affected.

This blog is from Focus on Film, the weekly e-newsletter that covers the latest news regarding window film and related products, including paint protection film. Click HERE to sign up—there is no charge. Interested in a deeper dive? Free subscriptions to Window Film magazine in print or digital format are available. Subscribe at no charge HERE.

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