Our Favorite Chapter
Late last year the loudest whisper in business circles was that upwards of 25% of businesses could go bankrupt. We’re definintely starting to witness a growing number of area companies throwing in the towel financially. Here’s a sampling of the recent happenings:
Individual cases of bankruptcy are also starting to soar. According to Wisconsin Lawyer:
In the Eastern District, the number of bankruptcy filings from January 2009 through April 2009 was more than 33 percent higher than over the same time a year ago and more than 86 percent higher than over the same time in 2007. The number of the most common filings, Chapters 7 and 13, is up 27 percent from a year ago.
What kind of an impact will this economic destruction have on our area’s economy? The lingering reliance on manufacturing and transportation jobs will likely entail continued job losses as economic troubles for businesses pile upon personal financial distress, keeping us in a downward spiral for the foreseeable future.
In a situation like this, I certainly understand why raising the taxes would be considered by many to be ill-advised. People are trying to save as much money as possible right now, so every little bit helps. Unfortunately, this cautious approach is also being applied to business taxes in a manner that distorts the meaning of small business. Buried at the end of this article quoting business lobbyists and organized anti-tax interests — and “balanced” solely by Dept. of Commerce Executive Assistant Zach Brandon — is this absolute gem:
For 2007, Brandon said, about 421,000 Wisconsin tax returns listed business revenue as personal income. Of those, he said, about 4,600, or 1.1%, made enough to get hit by the 1-percentage-point increase in the personal tax rate had it been in effect then.
He said the average annual income of those filers was $577,000. For a couple with that income filing jointly, the tax increase would total $2,770.
Small businesses are being exploited in order to keep the State from fulfilling it’s duty to generate sufficient revenue to fund it’s services. You can argue that not all the services are needed, or even benefit you, but when trimming government would only serve to further the downward spiral it’s important for our government leaders to consider all options for generating sufficient revenue. If people making close to $600,000 a year — a figure that most households would be lucky to earn after ten years of work — are asked to pay an additional $3,000 per year in taxes, I do not think we’re placing anyone with such a sizeable income in dire straits.