Rob Portman, November 25, 2002

When you hear news about business and the state of the economy, the stories almost exclusively revolve around large companies. While bigger companies do have a large impact on our economy, the importance of small businesses is often overlooked. It is small businesses that employ 53 percent of the private work force, and produce about 75 percent of new jobs.

Here in Ohio, small businesses play an especially important role. Seventy-five percent of employer firms in Ohio have fewer than ten employees, and 56 percent have fewer than five employees. With the importance of small businesses to our economy and to jobs, Congress should be focused on trying to create a business environment where these small companies can thrive. Some of the best ways to help small businesses are to keep taxes low and make sure these companies aren’t burdened by expensive and unnecessary regulations.

Congress did provide a big boost to small business in this past session when we passed the comprehensive tax relief package. This legislation lowered individual tax rates (85 percent of small businesses pay at individual rates) and eliminated the death tax, which prevents many small business owners from passing their life’s work down to their children or grandchildren. In addition, we passed legislation that allows small businesses to expense an additional 30 percent for the purchase of capital equipment.

Congress also used this past session to deliver much needed regulatory relief to small businesses. Legislation that I authored was enacted into law that simplified the rules governing pension plans. By simplifying these rules, we made it easier for small businesses to start and maintain retirement savings plans for their employees. We also repealed overly burdensome ergonomic rules that would have cost the private sector – especially small businesses – $100 billion and thousands of jobs.

Many people believe that international trade is only for large, multinational corporations, but small businesses are affected too. Over the decade of the 90's, the number of small business exporters increased by more than three-fold, from 66,000 firms to over 224,000. The Trade Promotion Authority enacted last summer will give the President the ability to negotiate new trade agreements and give small businesses exporters and family farmers opportunities to sell their goods to new markets overseas.

While Congress managed to get a lot done for small business during this last session, there is still much more that I would like to see us do in the next session. For starters, we need to

see that small businesses have better opportunities to afford health coverage for their employees. That is why I will support legislation allowing small businesses to pool their resources and obtain health insurance through a professional association. These associations would give small businesses more purchasing power and help make health coverage more affordable.

When Congress passed the comprehensive tax relief bill last year, Senate rules required that the legislation expire at the end of ten years. That means that while the death tax will be completely repealed in 2010, it would be fully reinstated in 2011. This bizarre consequence makes it very difficult for small employers or family farmers to do any sort of planning. That is why I will support legislation in the next Congress to permanently repeal the death tax.

Small business is the engine that drives our economy. In order to keep our economy growing, Congress needs to make sure that we are creating a business environment where these small companies can prosper. In this past session, we had some success, but we need to continue the fight for small employers and their workers in the years ahead.

Congressman Rob Portman represents Ohio's Second Congressional District the U.S. House of Representatives.