By Julio Fuentes
Guest Columnist |
Jun 30, 2021 at 5:30 AM
While too many Florida businesses are still struggling to keep their doors open in the face of ongoing economic challenges caused by COVID-19, President Joe Biden has proposed more tax hikes. Florida businesses simply cannot afford these tax increases — and neither can their workers, or our economy as a whole.
In the 20-plus years since I founded the Florida State Hispanic Chamber of Commerce, I’ve seen how vital Hispanic businesses — particularly small businesses — are to a thriving Florida economy. For those businesses to continue contributing to our state’s economic recovery, the last thing they need is to be hit with massive tax hikes.
Julio Fuentes is the President and CEO of the Florida State Hispanic Chamber of Commerce. (Courtesy photo)
The proposed tax increases are targeted directly at “pass through businesses,” meaning those that pass through their profits to the business owners — who are then taxed at individual tax rates. Countless small businesses in Florida operate this way, and they are sure to suffer from this approach.
Workers may suffer even more from lost jobs, slashed paychecks and higher prices for goods. A few years ago, the Tax Foundation found that workers are the ones who are likely to shoulder about 70% percent or more of the burden from corporate tax hikes. And with Hispanic workers disproportionately affected by the impacts of COVID-19, there can be little doubt that these latest tax hikes would hurt them significantly.
Raising taxes on individuals and corporations in this manner will not move us forward as a state and as a nation. In fact, it would take us back to the disastrous economy of the ’70s, when Washington — not workers — benefited. High tax rates shift profits toward the government and away from hard-working Floridians. When entrepreneurs are forced to ship more money to the government, it significantly limits their ability to create new jobs, increase wages, and develop innovative products or services.
The proposed tax plan raises the corporate tax rate from 21% to 28%. This would give America one of the highest corporate tax rates in the developed world — higher even than China. The increase is sure to make our country less competitive abroad while also sending American jobs overseas.
Instead, with policies that support small businesses and low tax burdens, we can create new jobs that stay at home, reduce our unemployment rate, and put Florida and the rest of the nation on track for much-needed economic recovery. We have proof of this in the Tax Cuts and Jobs Act, which lifted up American working families at every income level.
This tax plan would make President Biden the first president to raise taxes during an economic recovery. We’re finally approaching the other side of the COVID-19 pandemic and its devastating impacts, and we should be doing everything we can to help small businesses and working families keep their doors wide open.
That’s the way they can contribute to full economic recovery for Florida, providing goods and services to our communities and jobs for our hard-working residents.
Julio Fuentes is the president and CEO of the Florida State Hispanic Chamber of Commerce.