Entrepreneurs Welcome Bush's Tax-Incentive Plan --- But Many Worry President Will Choose Wrong Combination of Measures
On one point, most small-business owners agree: It's time for a tax cut. But ask any two entrepreneurs what the White House's tax-relief package should look like and you're likely to get two entirely different recommendations.</br></br>The Bush administration is expected to propose next month its most comprehensive set of tax incentives to date. And small businesses almost unanimously welcome the initiative as an overdue stimulus to the economy.</br></br>But many business owners worry that the president might come up with the wrong combination of measures. Some fear that too many tax breaks could backfire by widening the budget deficit, triggering either new tax increases or deep cuts in government spending. Others fret that the administration might offer too little, too late. And entrepreneurs differ sharply about which tax proposals would do small business the most good.</br></br>Mark Landis, president of Health Information Technologies Inc. of Princeton, N.J., a provider of an electronic network to link doctors to insurers, wants a cut in the capital-gains tax. That would make it easier for his company, which has 75 employees and annual revenue of about $6 million, to raise money, he says. Health Information Technologies has been financed primarily through investments from wealthy individuals. But "these are difficult times for attracting capital to small, developing companies," Mr. Landis notes.</br></br>Others favor another White House idea: making permanent a temporary 20% tax credit for increases in certain research spending. Such a credit would give PictureTel Corp., a Peabody, Mass., developer of tabletop video-conferencing systems, "the confidence to invest in an additional project or invest in more people and hardware," says Norman Gaut, chief executive officer.