Straight Talk- Small Biz Owners Can Breathe Easier-- 3% Withholding Repealed

Statement

Dear Friends,

After being deferred three times since its creation for being such bad policy, my House colleagues and I voted to repeal the onerous 3% withholding policy once and for all on Thursday. The new House majority has been focused on jobs since day one-- in fact, repeal of the 3% withholding marks 16 separate "jobs' bills the House has passed that can grow our economy and help create millions of jobs.

Compliance with this withholding tax will impose significant financial burdens on both the public and private sectors, adversely affecting job creation and economic growth at a time when we can least afford it. It will also further limit the cash flow of small companies that operate with thin margins in a difficult economy. Startups and small firms with a high volume of government contracts will be particularly disadvantaged.

The House Small Business Committee has taken an active role in pushing for full repeal. During a hearing back in May, we heard firsthand from small business owners who were worried about making payroll for their employees or even considering having to take out a loan to make ends meet if this provision was enacted.

That's why the full repeal of this tax is needed, once and for all. I encourage the Senate to do the right thing and act quickly to pass this bill that will provide more certainty for the thousands of businesses that contract with federal, state and local governments.

Sam Graves
Chairman

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