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Huizenga Discusses Impact Of Fiscal Cliff On Small Business, Need To Cut Spending In Holland
Bill Huizenga warns of 'fiscal cliff' implications for small businesses
MLive - Greg Chandler | The Grand Rapids Press
December 17, 2012
HOLLAND – U.S. Rep. Bill Huizenga says small, family-owned businesses could be among those most affected if President Obama and Congress cannot agree on a solution to the so-called “fiscal cliff.
Huizenga, R-Zeeland, illustrated the potential impact on one such business, a third-generation orchard in Mason County, during an address Monday to more than 500 people at a Michigan West Coast Chamber of Commerce breakfast at Evergreen Commons.
Huizenga said that without an agreement to solve the “fiscal cliff,” the orchard would be subject to increased inheritance taxes, resulting from a reduction in the estate tax exemption from $5 million to $1 million and an increase in that tax rate from 35 to 55 percent.
“Who’s buying orchards right now? Who’s going to buy the equipment that services the orchards? Which of your brothers or cousins are you going to lay off?” Huizenga asked. “That’s a big fear I have.”
Huizenga, who serves on the House Financial Services Committee, was to fly back to Washington after the breakfast to work with his colleagues on solutions to the problem. He says with the exception of a few representatives on either end of the political spectrum, most of his congressional colleagues do not want to see the country go off the cliff.
“Most people don’t want to see this happen. The question is, what’s the severity and what is the impact on our economy?” he said.
Huizenga said any solution to the “fiscal cliff” must involve both increasing revenues and cutting spending, and criticized the Obama administration for focusing its attention solely on the revenue side and not addressing entitlement spending, which the congressman called “the main driver” of the deficit budgets of the past few years. He says job creation and improving the economy will bring increased tax revenues.
“The president said we want a trophy, and that trophy is (increasing) tax rates. It’s not so much about revenue, about how much it’s going to raise,” Huizenga said. “I truly believe it’s about the symbolism of going after that upper 2 percent of wage earners, of income earners.”
Increasing taxes on that upper 2 percent, Huizenga said, could bring in an additional $50-$80 billion, which is still significantly short of the trillion-dollar deficits the nation has been running the past several years. Since the start of the federal fiscal year in October, the nation has been running $172 billion in the red, he said.
Responding to a question from one of those attending the breakfast, Huizenga did not believe that popular tax deductions such as the mortgage interest deduction or deductions for charitable contributions would be part of a final solution, but added that anything is possible.
“I think what most people agree is that this layer-cake, decades of loopholes and credits that have been have piling up has to get cut,” Huizenga said. “We have to figure out how to streamline, flatten and broaden our tax base. What I’m not interested in is just putting more revenue into a broken system.”
John Irwin, a senior vice president at Huntington Bank, said Huizenga has been an effective advocate for the business community during his first term in office.
“His knowledge of small business, job creation, growth, regulatory issues and tax issues facing small businesses helps Bill lead our efforts in Washington,” Irwin said.
Huizenga also spoke about the realignment of his district in light of the 2010 census and the impact on his district operations. He is planning to close down his current district offices in Holland, Muskegon and Cadillac, the latter of which is now outside his district, to be replaced by new offices in Grandville and Grand Haven. His district now includes most of the Kent County suburbs, including the cities of Walker, Wyoming and Kentwood.