Opinion Columns & Blogs

All small businesses benefit from tax plan

While Eagle news coverage and recent guest columns have fixated on supposed problems with the tax bill passed this year by the Legislature, they are missing the much more important point that many Wichitans inherently understand.

That is, the Kansas economy simply is not growing and adding jobs as we all would like it to, and the best thing state government can do is create an environment in which more families and small businesses can thrive.

That’s why Gov. Sam Brownback worked with the Legislature this year on sweeping tax reform that broadly benefits Kansans. Under the plan, starting in January, every individual taxpayer’s rates will decrease 14 to 24 percent.

Every Kansas taxpayer will see his or her standard deduction double from $4,500 for a single head of household to $9,000 for those married and filing jointly. This will significantly reduce the tax liability for the two-thirds of Kansas taxpayers who do not itemize on their tax returns but instead use the standard deduction.

To put it bluntly, that means more people owing less taxes than they did before, leaving more money in their pockets to invest back in the state’s economy as they see fit.

Further, the governor’s vision was to give small businesses a shot of adrenaline so they can survive in these challenging economic times.

We’re doing this by exempting non-wage business income from state income tax. This innovative approach is aimed at the heart of small business and will benefit a wide range of industries, business models and people throughout Kansans who need additional capital to grow their businesses and create jobs.

We welcome further discussion of the technicalities of implementing tax reform. But this discussion should not obscure that action was urgently needed to boost the economy, and the governor and Legislature took important strides forward this year to cut the tax burden on Kansas families and small businesses.

As Brownback noted at a recent small business summit attended by hundreds of entrepreneurs and Overland Chamber of Commerce members, politicians frequently talk about the importance of small businesses, but the policies crafted often don’t benefit this critical component of Kansas’ economy.

This year’s tax reform bill is for all small businesses, not just a select few in a specific sector, by allowing everyone filing non-wage business income on the K-40 form to keep more capital to invest in growth.

Many economists agree that the best tax policy is one that has a low rate that applies to the most people. This tax plan does just that, and by benefiting the most Kansas taxpayers, it is a sound tax policy for the future.