[Congressional Record Volume 142, Number 110 (Wednesday, July 24, 1996)]
[Extensions of Remarks]
[Page E1364]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   GOOD THINGS COME IN SMALL BUSINESS

                                 ______
                                 

                         HON. WILLIAM M. THOMAS

                             of california

                    in the house of representatives

                        Wednesday, July 24, 1996

  Mr. THOMAS. Mr. Speaker, there is nothing small about small business. 
In my district alone, small businesses (under 500 employees) account 
for the vast majority of the total local business establishments. 
Nationwide, over 21 million small businesses employ more than half of 
the private work force. The irony is that while small business provides 
such major benefits to the community, it is the target of the 
Government's wrath in terms of taxation and regulation.
  Time and time again, this vital part of our economy is forced to bear 
the brunt of higher and new taxes. Small businesses faced the highest 
tax increase in American history in 1993. Statistics show that 70 
percent of those affected by the 1993 tax rate increase were small 
businesses. Under this type of capital constraint, small businesses can 
be forced to downsize. Self-employed small business owners have an 
additional burden as they have not been able to deduct more than 30 
percent for health care costs. Small businesses can even be blocked 
from growing by their inability to get accurate information on ways to 
comply with laws and regulations.
  This Congress is moving to encourage small business. With the passage 
of the Small Business Job Protection Act, H.R. 3448, in both the House 
and Senate and health insurance reform (conference pending), H.R. 3103, 
small businesses can look forward to benefitting from a reduction in 
taxes through an increase both in their expense limit and their 
allowable health insurance deduction. The bill also simplifies pension 
law, making it easier for small businesses to adopt retirement savings 
programs.
  Regulations serve as another impasse for growth in small business. 94 
percent of small businesses lack knowledge of current regulations. This 
apparent ignorance is not the result of stupidity, but rather a 
constantly changing set of standards expressed frequently in confusing, 
technical language. This creates involuntary noncompliance on the part 
of the employer. Now, if an employer is found in violation of this 
regulation, he or she faces the prospect of fines and ultimately 
corporate shutdown.
  As a cosponsor of the Small Business Regulatory Relief Act, H.R. 
3798, I recognize that my constituents cannot be in the dark about 
regulations that they are required to follow. Nor can they be expected 
to interpret the language of the mandate without any assistance from 
those who have direct knowledge of the intentions of the regulations. 
This act will reappropriate a negligible portion of the EPA, IRS, and 
OSHA budgets to Small Business Development Centers for purposes of 
offering counselling services to businesses regarding regulation 
compliance. In supporting this bill, I am optimistic that small 
business both in my district and elsewhere will be better equipped to 
comply in a cost-effective manner with the regulations of today and the 
future.
  Promoting incentives in small business growth is not just a district 
or a State issue, it is a national issue that demands our attention in 
order to ensure the stability of our economy. Small business deserves 
big recognition. It is time that our small image of this industry 
changes so that it reflects the huge rewards it bestows on our 
communities. Only then can we truly reap the full benefits of what is 
contained in small business.

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