The awaiting Tax increase issue in the U.S can cause harm to the small business owners in particular- a report revealed. Tax rate is being increased to make almost $200,000 at a time by taking extra cash from business owners, an amount that will though be used for development and growth. As business owners across the world are supposed to face financial crunches in 2013, it has been important for them to find ways to cut costs so that they can do more jobs using less amount. Below comes detail report on issues affecting business owners in the U.S and other countries, with solution to overcome those problems.
A Joint Committee (Bipartisan) on Taxation reported that only 3% of total U.S residents who run personal business and do not share the return with others have to pay the highest tax amount after the increase. However, this 3% will include those 940,000 (approximate) business owners also who have just reinvested in a business. The same committee that analyzed the other report has explained the same.
However, another release by a national organization that speaks for the small business owners have explained the issue in a different manner. The organization says that small business owners will face the impact of increased taxation more than any other business owners in the U.S. The report explains in detail that 72% corporation income (both big and small), 31% of private business income and 61% of shared business income will be negatively affected due to tax increase. The organization that spoke for small business owner and explained the report is NFIB.
Tax increase will also prove negative for borrowing issues as loan expenses will also increase along with tax. The report says thatUKwill face totally a different challenge due to the tax increase. Interest rate for loan amount below £1 million will increase rapidly within a few quarters though interest rate for loan amount over £2 million will decrease rapidly. It proves that the borrowing cost for small business owners will increase and for big business owners it will decrease. This report has been published by Kasey Kassel.
In the U.S the only good thing waiting for small business owners after tax rate increase is that, they don’t need to spend huge amount to travel from one country to another for business purposes. They will be able to reduce up to 56.5% of traveling expense in coming year and 55.5% of that will be deducted per mile basis.
Experts thus suggest different options for small business owners that will help them to cut costs. The most important of all is that small business owners must think about starting with virtual businesses instead of continuing with regular business. In addition, they must try to save a certain amount from the expensive cost of shipping. Business owners do not need to give much effort to save the amount required for shipping.
Last but not the least, business owners must find out new and useful options to boost up sale so that they can easily adjust with increased business costs. They should talk to business experts to know about different strategies.