Let’s Work! (Part 2)
by Mary Wakefield Buxton
Urbanna, VA—Last week I took wing on flights of imagination as to a solution to the nation’s economic woes…how I and other senior citizens might help younger generations pay off the massive debts that our generation generated by approving benefit programs for us at their expense.
I playfully argued that since we had caused the problem, we should be willing to solve the problem. We would do this by starting new businesses, hiring employees, paying more taxes, continuing to contribute to Social Security and Medicare while at the same time putting the unemployed back to work, paying off the national debt, and saving the country.
Opening the “Dog and Poet Pub” in downtown Urbanna was my plan. Not only would such an establishment provide intellectual stimulation to the teeming populace clamoring for more brainy activities in Middlesex County, but it would honor poets and dogs… my two most favorite beasts… and provide much needed jobs to the area.
But what would it take to start the Dog and Poet Pub in downtown Urbanna? I went to Google to look at what starting a new business would entail and I soon learned just why unemployment rates are so high in America… very few people want to take on such big risks anymore and at the same time face so many taxes and regulations.
When I graduated from college my generation’s number one dream was to start their own business. Has that dream gone in America like pollen in the wind? Many young people today want a job (preferably with government) that offers security, good wages, more holidays than the private sector enjoys, and other superior benefits. We see very few young entrepreneurs anymore.
There’s good reason for this; payroll taxes, license fees and a multitude of government imposed regulations that are attached to owning a business. Here are some:
First, one must purchase a business license. After purchasing or renting a suitable site, utilities must be ordered which are riddled with local, state and federal taxes. You may owe the county personal property taxes on the equipment you own in your business and have to pay minimum wage, even if workers hired are teenagers working in the summer to gain first job experience.
A business in Urbanna at least would be exempted from the county’s staggering BPOL tax. (It charges a tax based on GROSS receipts so if a business has receipts of $500,000 a year but only nets $20,000, it still pays taxes based on $500,000.) How many businesses and jobs has this tax alone driven out of our county?
There is an assortment of federal payroll taxes which include a percentage of every employee’s Social Security, Medicare and unemployment taxes. One might also be responsible for providing health and dental programs not to mention overtime pay and paid time off for holidays, sick leave, family leave, jury duty, and vacations.
There are self-employment taxes owed to the IRS, Social Security and the Commonwealth including business tax registration and general taxes such as workman’s compensation, unemployment insurance tax, corporate income tax, employer withholding tax, and special use taxes along with a new tax (now in force) called a “litter” tax.
If the Dog and Poet Pub sold merchandise I would have to collect a sales tax for the state. The Town of Urbanna would charge me a local tax levied on every meal served.
If taxes aren’t discouraging enough to business, government regulation is just as bad. Many regulations are in play today, depending on the size and type of business, such as those from OSHA (it sends inspectors to inspect your business site for safety infractions and can lay very heavy fines) or the state health department (which inspects kitchens if you prepare food.) The EPA can assign stiff fines and even put a business owner in prison. If someone complains that hiring or promotion decisions have not been “fair,” the EEOC can come calling. Few small businesses can afford to hire a lawyer to defend themselves from government attorneys.
Then, I would have to meet payroll each week even if I had earned no profits. If I had to close shop and let employees go, I would have to pay unemployment insurance.
Finally, if from all my hard work my business is a success… hurrah! But how many federal and state income taxes would I owe a government that is now so determined to redistribute wealth? In other words, I take all the risks, work hard, face a good possibility of failure and bankruptcy, but then pay big income taxes if I succeed.
It’s a great game government has set up. Too bad for job creation in America, once the land of opportunity, not many people want to play it anymore.
Next week, Mary decides to forego the pleasure of owning a business and become an employee. Join her as she looks for a job.
