NGA Opposes Obama Tax Plan

ARLINGTON, Va. — National Grocers Association on Monday said it was opposed to President Obama’s plan to allow the so-called Bush tax cuts to expire at year-end for those making more than $250,000 a year.

Peter Larkin"Today the president again called for increasing taxes on thousands of individual entrepreneurs who operate their businesses as pass-through entities, such as Subchapter-S Corporations and LLCs,” said Peter Larkin, president and chief executive officer, NGA. “By allowing tax rates to increase for joint filers with income above $250,000, thousands of pass-through entities will be forced to divert capital to pay Uncle Sam's tax bill instead of growing their businesses and creating jobs.”

More than 50% of NGA's members operate as pass-through entities, the association said, “so the impact of a tax hike on these entrepreneurs will be significant.” NGA said its members continue to call on Congress to extend the current individual tax rates for all income levels for one year, so Congress can address comprehensive tax reform. If the tax cuts are allowed to expire, rates for some businesses could increase by about 3 percentage points, NGA told SN earlier this year.

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In addition, NGA said Congress should make permanent the current estate tax top rate and exemption “so businesses can have some certainty for the future.” The estate tax, levied when a family passes its business from one generation to the next, is currently 35%, with an exemption of up to $5 million, but is scheduled to return to its previous rate of 55% with a $1 million exemption at the end of the year.

Discuss this Article 13

Anonymous (not verified)
on Jul 10, 2012

Suck it up big boys. You've been holding back investing in your business to help the economy when you should have. You helped stifle growth up to now so now it's time to pay your share of this recession.

Anonymous (not verified)
on Jul 10, 2012

I don't think many would have an issue of paying more so long as there are cuts and a plan to balance the budget. Assuming politicians will do the right thing with the $ is a pipe dream without some structure. Mr. Obama has plenty of ways to spend more money but lacks both the conviction and vision to champion the needed changes so that we do not inflict any more hardship on future generations. The problem is many of the future generation do not have the insight or understanding of history to vote directionally in a way to help themselves....only to get more in handouts. No wonder many of us are not willing to give in and just watch hard earned $ go into a big black hole that continues to feed the government beast.

Not a Big Boy Grocer (not verified)
on Jul 10, 2012

After reading the postings it appears that the majority of the replies are weighted heavily toward the left, have a deep sense of anger toward business, and are completely unaware of the audience they are attacking.
We ( NGA members) aren't the "Big Boys". We are the local independent grocer. The guy with the small building down in the neighborhood that infills the territory left by the big corporations.
Raising taxes on left over cash after paying down remodeling loans WILL result in cuts in our expenditures. Either cutting hours, benefits or new replacement equipment, none of which will improve the labor market or economy.
You also don't know, care, or both, but we are the guys that purchase a much higher share of local products, supporting thousands of other small businesses that are overlooked by the big supermarket chains.
We are the small business segment that WILL BE hurt by tax increases.
I know, I'm one of them.
And I fully support the NGA position.

Anonymous (not verified)
on Jul 10, 2012

Congress did nothing to fix the problem in this last extension period, they just keep kicking the can down the road. Time to pay the piper for a while and then see if Congress can step up to the plate. BTW, the tax difference for an Entrepreneur at the $250K tax threshold won't pay to hire even a part time worker, let alone allow them to buy any significant piece of equipment. The real issue is that no one wants to pay taxes, but they want great schools and great roads and wars we cannot afford.

Anonymous (not verified)
on Jul 10, 2012

This is not a tax increase! It's eliminating a tax cut and putting the tax rate back to where it was and should be. But none of this matters because everyone making more than $250k has so many tax loopholes that they end up paying a lot less of a % of tax than the middle class does and that is WRONG.

Anonymous (not verified)
on Jul 10, 2012

Anyone that knows anything about taxes, including the higher earner, has been and will continue to call for comprehensive tax reform. It is time we simplify our tax system and do it in a way that can truly bring tangible results. Taxing the rich and the small-medium business owners more and more is not going to solve our debt issues.

David (not verified)
on Jul 10, 2012

This is, of course, a ludicrous and dishonest position that does not represent the real needs of many of the NGA's members. The NGA definately does not speak for me.

I am an individual entrepreneur who operates my business as a pass-through entity. The proposed expiration of the Bush tax cuts will not raise my tax bill by one cent. And the NGA and opposing Congressmen know that it won't for many others either.

If my business expands and creates jobs, the money used for that expansion is not income to me or my business. It's expense, which reduces my tax liability.

As for the estate tax, its purpose is the same as that of expiration of copyright and patents. That is, it is intended to give protection for the creator for some time to recover his cost of creation, while encouraging him (and others who come after him) to create MORE. Lower estate taxes and non-expiring copyrights and patents only encourage creative, technological, and economical stagnation, where a creator's heirs are encouraged to not do anything to further the society or economy.

David Wolfe, independent Grocer (not verified)
on Jul 11, 2012

To clarify for those attacking the honest comments posted here, I AM an independent grocery. I own and operate a single, small-format store. I am exactly who the NGA exists to represent. I am not a member exactly because the NGA's positions and lobbying do not represent my best business interests.

The thing I (and mostly all other small businesses of any type) need is for my customers (mostly middle- and lower-income families, again like most businesses that are not Whole Foods) to have more income. The only thing that will bring more certainty--the only thing that will allow my business to continue to expand--is for me to have more customers spending more money in my store. All the rest of the arguments being made, arguably on my behalf--health care reform, taxes, national debt, etc.--are dishonest rubbish intended to scare the masses away from those who would do the one thing that is important: make sure I have more customers with more money in their pockets to spend.

Anonymous (not verified)
on Jul 10, 2012

Another comment - businesses and the rich have yet to "trickle" down their wealth to grow business. They also try to convince us that increasing the minimum wage will cause layoffs when in fact, the very small increase in minimum wage is nothing compared to the executives who get paid way more than they need to be paid. Perhaps if they decreased their pay they could pay people enough of a wage to have a family and benefits. I'm sick and tired of these people wanting the rest of us to feel sorry for them when so many people can barely eek out a living on what they pay their lower end people. And don't forget that the people you are paying literally nothing are the same ones who face your customers on a day to day basis and they DO have a big impact on who shops at your stores. Greed is what will bring this country to its knees - it already has and it will only become worse if this keeps up.

Anonymous (not verified)
on Jul 10, 2012

NGA seems controlled be self serving elites.

Fact: Giving the middle class a tax cut will help them spend more on grocery trips.
Fact: Having the wealthy pay the same tax rate under Bill Clinton will ease the deficit 1 trillion over 10 years.

Anonymous (not verified)
on Jul 10, 2012

Without good roads the raw material provider can not efficiently deliver to the manufacturer. The manufacturer can not deliver to the Wholesaler. The the wholesalers trucks can not deliver to the grocer. The customer can not get to the store that can only be built on its large suburban lot by car.
The car is delivered by trucks, its fuel is delivered via the roads etc...
Government's main business is not handouts! It's main business is providing services that are can not be provided by the private sector.

Oscar L. Nunez, M.A.S. Grocery Busi (not verified)
on Jul 10, 2012

I'm glad to see our leadership take a position for our membership.
Congratulations.

I'm so glad someone is so focused while the rest of us our being made to keep an eye on the ball, Obama Care & these miniscule changes in our tax laws. While all the while these Washington crooks are coming up with the next big hit on us, the American people; & when did we vote for these:

1. The likes of "Globalization" to develop other nations at our sacrifice & expense.
2. As we developed globalization - oh, we need an army to defend "capital" interests throughout the world. Oh, we can do that. Some even disguised as N.A.T.O. We are now the world's police.
3. The "Maquiladora" program that emptied out Los Angeles & took 1,000 factories across our Mexican border overnight.
4. NAFTA
5. We saw in CNN Genocides how we ignored the killings of millions of innocent people throughout the world where we didn't have a capital interest to defend, &, yet, Washington feeds us just how much to care about the possibility of killings in Lybia of maybe 2,500 people & we go in and kill & overthrow a government.
6. Then, there's Social Security. I started working at age 11 & I really don't know when I started contributing to Social Security, yet, changing our contract with our citizens, after maybe contributing for 40 years, & changing my retirement age to 66 is an abomination; I've never seen a retroactive tax law change as this was.
7. Then, our government employees organized, left our Social Security System, it's a Federal Act, my goodness; Got Congress to throw them a white towel to allow them to "opt" out of Social Security"; An unconstitutional act by Congress, if you run it through the Supreme Court. Then, these guys gave themselves big raises & 100% pension pay, 100% of their last year's pay whenever they retire.
So, the private sector gets about 20% and the
Public Government Employees get 100%. Can you believe that?

Are we intentionally pushing our American People to an American Revolt as we have never seen in our history?

Lastly, our "Estate Tax" should be repealed for all the right reasons that haven't changed from day one.
We shouldn't invite the world to bring their money here to create wealth, jobs, & security, &, then, hit them with this Estate Tax, known as the death tax, once they die & the transfer of wealth to the next generation takes place.

Good enough.
To my NGA leadership keep your eyes pealed & yell as hard and as loud as you can, on our behalf.
Congratulations. I'm grateful.

Oscar Nunez, C.P.A. ( Since 1979 ).
CFO, General Auditor, Grocery Business Advisor.
Boardroom Advisor. Management Advisory Services - Operations, Administration, & Management Since 1979.
Helped grow the Top 9th, SN Top 50 Small Chain & Independents, Northgate Gonzalez Markets from 3/1986 to 6/2007.

anony-mouse
on Jul 11, 2012

$250,000 seems to be a very fair cut off, most small businesses the NGA (supposedly) represent would be happy to make that much NET income.

We've had these tax breaks for the last 12 years and it's gotten us to the point we are now - time for a new game plan.

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