Unclear on the concept
Friday, Feb 14, 2014
* Rep. Mike Smiddy (D-Hillsdale) supports raising the minimum wage to $10 an hour and talked a bit about the impact on small business…
* OK, this is a bit off on at least a couple of levels.
1) Big corporations don’t pay a whole lot of corporate income taxes. But unless they’re in a TIF district, some of the only taxes that big corporations pay are property taxes. Shift property taxes to the income tax and corporations won’t be paying much of anything. Unless something else is done, the burden will be shifted to individuals and small businesses.
2) Except for the 2.5 percent Personal Property Replacement Tax, most small businesses don’t pay the corporate income tax at all, but they do pay personal income taxes. Increasing tax rates on higher earners will most definitely impact small business owners.
You want to help out small business in exchange for raising the minimum wage? Well, one option would be to lower or eliminate the PPRT, or do something more about workers’ comp and unemployment insurance costs.