With October being Women’s Small Business Month, it’s important to address the influential voice women hold in shaping our country’s future, especially our economic future. Since our country’s founding, women have fought to leave political, social and educational legacies, creating incredible success stories. Women now have the opportunity to shape the business world and are doing so with great strides.
The Wall Street Journal recently reported that for S&P 500 companies, female CEOs are out-earning their male counterparts, with the annual salary difference averaging around $2 million. Yet much more is to be done to support women in the workforce. The best place to start is with small-business tax cuts.
Small businesses are a pillar of our country’s economy. But despite the fact women represent the fastest-growing business demographic, they’re still disproportionately represented in the business world. Nationally, women own close to 11.3 million small businesses, which collectively employ around 13 million people. While on the surface that seems successful, it actually only accounts for 40 percent of all small businesses and 23 percent of employees.
In a report by the World Economic Forum, a correlation is drawn between an increase of women in the workforce and an increase in economic growth. Small-business tax cuts are crucial to not only encourage more women to join the workforce but also to start a small business. Both are important steps to curing our country of a stagnated economy.
A report commissioned by American Express determined in the past 10 years women-owned firms outperformed all American businesses, citing greater growth in ownership, employment and business revenue. When female business owners are left to capitalize on their talents, great accomplishments occur.
But the uncertainties created by the current tax code deter individuals, especially women, from investing in a small business. Nearly 95 percent of small businesses pay taxes as pass-through entities, meaning they’re taxed as individuals, which on the federal level reaches almost 40 percent. Once state and local taxes are added in, these rates can reach 50 percent, placing companies at an inherent disadvantage. If the woman is single, the taxes are even more burdensome. Current tax policy favors married people. What about the single mother? There is no better way to help her succeed than cutting taxes so she can use her money for a better life.
A recent poll conducted by the Job Creators Network determined a majority of small-business owners claimed they would use savings provided by a tax cut to raise wages, create jobs and expand their businesses. That’s where the skills of small-business owners lie. These individuals are entrepreneurs, not tax attorneys. Their time is best spent on their business, not perusing the IRS tax code.
I have owned and operated a small business for 20-plus years in the state of Colorado and have managed to keep it up and running successfully, despite exponential exploding regulation and taxation. My business — the 88 Drive-In Theatre — is one of the only remaining drive-ins in the state of Colorado and provides a unique service that is not easily found elsewhere. There are less than 350 drive-ins remaining in the United States and almost all of them are family-owned.
Sadly, the businesses like mine that offer these experiences are disappearing from the landscape in Colorado as well as the rest of the country. The federal government, not to mention state and local governments, imposes too many regulations and sky-high taxes on entrepreneurs who own, operate and start these small businesses. The ability to start a small business is the ticket to a better life — living the American dream of pursuing happiness.
The newly released Republican tax plan provides a 40 percent tax decrease for small businesses, bringing their rate down to 25 percent. This is a much-needed change that will free up resources for business owners to do what they do best: Creating jobs and servings their customers. Our country is strongest when all citizens are provided opportunities to succeed. That opportunity can be created through small-business tax cuts.