For Immediate Release
Office of the Press Secretary
August 11, 2004
Fact Sheet: Supporting America's Small Businesses
President Bush recognizes that supporting America's small
businesses is critical to ensuring continued job creation. Small
businesses create two-thirds of new private sector jobs in America,
employ more than half of all workers, and account for more than half of
the output of our economy. Because small businesses are vital to our
prosperity, the President has taken important steps to assist small
businesses and the hard working people they employ by reducing taxes,
encouraging investment, and removing obstacles to growth.
The President's Policies are Helping America's Small Businesses
- More Americans are working today because the President made tax relief for America's small business a key component of his economic
- In 2004, 25 million small business owners will receive tax
relief totaling about $75 billion.
- The President's Jobs and Growth package reduced marginal
income tax rates across the board, including the creation of a new
10-percent tax bracket and the reduction of the top rate to 35
percent. These rate reductions benefit the more than 90 percent of
small businesses that pay taxes at the individual income tax rates, not
the corporate rates.
- The President's Jobs and Growth package also raised the
amount that small businesses can expense for new capital investments
from $25,000 to $100,000, reducing their cost of purchasing new
machinery, computers, trucks, and other investments, and giving the
manufacturing sector a boost.
- The President supported and signed into law the phase-out of
the Federal death tax, ensuring that family business owners are able to leave their businesses to their families or key employees.
- The President has made tax relief permanence a top priority. All
the tax relief enacted over the past three years, including the
tax relief benefiting America's small businesses, is scheduled to
expire over the next several years. Raising taxes on small businesses
will hurt economic growth and job creation.
- In 2005, the expanded 10-percent bracket will sunset,
increasing the tax burden of millions of owners of flow-through
- In 2006, allowable small business expensing will shrink from
$100,000 to just $25,000, increasing the cost of capital investments
for America's small businesses -- thus subjecting them to a higher top
tax rate than corporations could face.
- In 2011, the rate relief and other tax relief enacted over
the past three years will sunset, resulting in a tax increase for every
small business that pays taxes as an S corporation, a partnership, or a
- In 2011, the death tax returns, threatening the ability of
family farms and businesses to survive from generation to generation
and increasing the costs of estate planning for their owners.
- In addition to reducing the tax burden and opening markets, the
President is helping millions of entrepreneurs by keeping our economy
the most dynamic, flexible, and innovative in the world. This agenda
is especially important to America's small businesses.
The President has worked to make health care more affordable. The President has called for Association Health Plans (AHPs) to give America's working families greater access to affordable health insurance. By allowing small businesses to band together and negotiate on behalf of their employees and families, AHPs would help small
businesses and employees obtain health insurance at an affordable
price, much like large employers and unions.
- The President has also signed into law health savings accounts (HSAs), which combine low-cost, high-deductible health insurance with tax-free savings accounts to pay for health care expenses and save for future medical needs. The President has also proposed to make premiums for health insurance purchased in conjunction with an HSA tax deductible.
- The President is pushing Congress to pass legislation
reducing frivolous lawsuits. The President supports enactment of
medical liability reform, class action lawsuit reforms, and asbestos
litigation reforms to expedite speedy resolutions of plaintiffs claims
and curb the costs frivolous lawsuits impose on American businesses.
- The President has proposed, and called on Congress to adopt,
a National Energy Policy (NEP) to ensure that America has a reliable
and affordable source of energy and to reduce our dependence on foreign
sources. The Administration has completed implementation of nearly 75%
of the more than 100 recommendations contained in the President's
- The President is urging regulatory relief to ensure that
Federal regulations do not unduly handicap America's entrepreneurs by
streamlining regulations and reducing paperwork. Since the President
took office, the Administration has slowed the growth of burdensome new
rules by 75 percent, while still moving forward with crucial safeguards
for homeland security, human health, and environmental protection.
American small businesses saved $6 billion last year and more than $30
billion since 2001, due to the President's regulatory reforms.
- The President is expanding opportunities for American small
businesses--abroad and at home.
America is the world's largest exporter, and America's small
businesses are a large part of that success.
- U.S exports accounted for about 25 percent of our economic growth during the 1990s, supporting an estimated 12 million jobs, and small and medium sized companies make up 97 percent of all exporters.
- The Bush Administration is opening markets for American goods and services by completing free trade agreements with 11 countries
(Australia, Morocco, Chile, Singapore, five countries of Central
America, the Dominican Republic, and Bahrain) and launching
negotiations with 10 others (Thailand, Panama, five countries of the
Southern African Customs Union, Colombia, Ecuador, and Peru).
- Taken together, the free trade agreements that the Administration has completed and/or launched would constitute America's third largest export market, totaling $66.5 billion in U.S. exports.
- Small exporters benefit from these agreements. For example, more than 6,000 small and medium-sized businesses export to Chile, more than 4,000 export to Costa Rica, and approximately 3,000 export to
- The Bush Administration is working to ensure that small businesses
can compete fairly for their share of Federal government contracts,
expand in under-served areas, offer flexibility in the workplace, and
have access to capital.
- The President developed a strategy to reverse the trend toward the bundling of contracts, a practice that denied small businesses the
opportunity to win billions of procurement dollars.
- Small businesses won more than 23% of all contract dollars last
year, reaching a historical high and exceeding the statutory goal
for the first time by any Administration.
- In fact, Federal contract dollars to small businesses owned by
women, minorities, and veterans increased to historic levels,
surpassing several statutory goals in 2003.
- Contracts to small firms that are socially and economically
disadvantaged increased last year by an astounding 80%, from 249,000 to
- The Business Matchmaking Initiative, launched last year, advances
the President's goal of giving small businesses a fair chance to
bid on Federal contracts by connecting businesses directly with
Federal, state, and local government agencies and large companies
across the country to discuss business contracts.
- The President has announced a new initiative to expand business
ownership and entrepreneurship among minorities. The Administration
will undertake a unique association with the National Urban League
(NUL) to create an entrepreneurship network. Supported by the Business
Roundtable and the Ewing Marion Kauffman Foundation, the NUL network
will include one-stop centers for business training, counseling,
financing, and contracting.
- Between 2001 and 2003, the Bush Administration has increased the number of loans to small businesses by more than 50%, a 50-year
record. This record level has already been surpassed in 2004.
- The President has urged Congress to amend the Fair Labor Standards Act to provide private-sector workers the same voluntary, flexible scheduling options that government employees already enjoy, including Comp-Time and Flex-Time. Now that more families have both parents in the workforce, American workers need more options and flexibility to arrange their work schedules.
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