For the first time in years, the nation's 25 million small-business owners feel they have a stake in the outcome next November. It doesn't happen often, but this presidential-election year features a raft of issues affecting their pocketbooks. Some, like the minimum wage, are perennials; others, like Internet taxes, are brand new. All, however, pose dramatic changes in the way small companies do business, take care of their employees and pay Uncle Sam. Here's a sampling of the leading issues Washington hands are wrangling over:
HIKING THE MINIMUM WAGE A higher minimum wage is so popular with voters that in March, 78 Republicans in the House of Representatives joined their Democratic colleagues to approve a $1 hike, which would raise the base wage to $6.15 an hour. House G.O.P. leaders have tied the raise to their $123 billion tax-cut package, which President Clinton has vowed to veto. But both parties are so eager to score election-year points that a compromise is highly probable.
What do corporate small fry think of this? "It can really hurt cash-strapped concerns struggling to maintain their profit margins," says John Emling, a lobbyist for the National Federation of Independent Business (NFIB) in Washington. "But if we have to swallow this bitter pill, we want some sugar coating (such as the proposed tax cut) to help it go down easier."
Democrats: Yea Republicans: Yea
ROLLING BACK THE DEATH TAX This 84-year-old tax requires estates to pay an assessment of 37% to 55% on the value of assets greater than $675,000 after the estate holder's demise. Family businesses decry the tax as an abusive penalty, because kids are suddenly hit with crippling bills that often force them to sell off Mom's or Dad's legacy. Supporters? They say the tax helps close the gap between rich and poor. The G.O.P. is mounting a three-pronged attack on the tax. The House tax-cut bill passed last July would slash the estate tax's floor rate to 18% and the ceiling to 50%. Republican Representative Jennifer Dunn of Washington is backing that up with a separate bill that would ease the tax 5% a year until it reaches zero by 2010. And G.O.P. Governor George W. Bush of Texas has vowed to kill the tax outright if elected President. Many Democrats agree with Vice President Al Gore that a repeal would be a sop to the rich. But others believe the benefits for small companies outweigh that concern. Democratic Representative John Tanner of Tennessee, for one, is co-sponsoring Dunn's bill, and there seem to be enough like-minded Democrats to fashion a compromise on the issue.
Democrats: Nay Republicans: Yea