Wed April 14, 2010
Can Washington DC really create jobs? Apparently not, jobs are a derivative of economic expansion. But Washington seems to think the job comes first. Hence Washington offers a tax credit for hiring someone. A tax credit is a direct deduction of taxes owed, but in a recession, most small business does not owe tax anyway.
Caroline Baum at Bloomberg quotes several business owners pointing out that they have no tax liability to take the credit against. And that increasing taxes on the owners and mandating health care is making things worse. Mish notes the same thing in his column today.
The tax code is an impediment to just about everything. Congress actually believes that tinkering with this or that jump starts business into action, the truth is that complex, ever changing tax rules make it more not less difficult to make a decision. Wash DC does not seem to grasp that business is not making sales, hence the unemployment.
Professor Elam 
Leave a comment