by Steve Lutes
U.S. Chamber of Commerce
Good news for job creators. Legislation to repeal the onerous 3% withholding tax took a major step forward today with approval by the House Ways and Means Committee.
Comments by Chairman Dave Camp (R-MI) and Ranking Member Sander Levin (D-MI) as well Congressmen Wally Herger (R-CA) and Earl Blumenauer (D-OR), all champions of the effort, underscored the bipartisan support this bill enjoys.
Chairman Camp said it will “reduce the uncertainty facing America’s job creators” while Rep. Levin called the 3% withholding tax “misguided.” Rep. Blumenauer labeled the 3% withholding tax “grotesquely misdirected” and warned that the total cost of this mandate “dwarfs” the receipts that would be generated. And Rep. Herger called repeal a win-win that gives “businesses the assurance that it’s safe to invest, grow and hire more workers.”
Next step…floor of the U.S. House of Representatives. We anticipate the House will be voting on this important measure sometime during the next couple of weeks. We are encouraging our members to contact their local Congressman, urging them to vote for repealing this burdensome tax.
Remember this mandate takes money from local economies and America’s small businesses. For many businesses affected by this mandate, the profit margin is often less than 3%. The withholding tax will create significant cash flow problems for day-to-day operations as well as drain capital that could be used for job creation and business expansion. During these difficult economic times, Congress should be pursuing policies that encourage, not hamper, private sector job creation.