Every four years since 1982 the NFIB has surveyed a large sample of small business owners to research their perspective on 75 potential business problems. Here are the top “Critical” problems and priorities from the most recent survey.
1. Cost of Health Insurance
This has been the number one problem for small business for 30 years! 52% of NFIB respondents cited this as number one. Health insurance costs for small business have risen 56% in the past ten years, outpacing wages and inflation. Higher costs have driven a decline in the number of companies offering health insurance from 42% in 2004 to 29% currently.
2. Unreasonable Government Regulations
This moved up from fifth four years ago due to the increasing burden put on business by the last Administration. The cost of compliance was characterized by extra paperwork and difficulty understanding exactly what had to be done to comply.
3. Federal Taxes on Business Income
30% of respondents cited Tax related issues like current rates, complexity of compliance and frequency of change in regulations as their number 3 problem and priority. “State Taxes on Business Income” ranked number 10 on this list. Confiscation of profits for taxes were cited as a key impediment to growth.
4. Uncertainty over Economic Conditions
Uncertainty triggers anxiety among consumers, investors and business owners, which is a true enemy of economic growth. The ability to anticipate future costs is critical to business plans and expansion opportunities.
5. Tax Complexity
Mounting pressure to simplify the tax code is being driven by the increasing cost and time consumption of Tax Compliance. Reduced compliance costs by the new Administration will contribute to capital accumulation and the owner’s ability to focus on growing their business.
6. Uncertainty over Government Actions
In addition to the headline reform issues, imposition of regulations on businesses by other fed, state and local agencies in areas of employment and the environment drive the criticality of this issue for over 26% of survey respondents.
7. Frequent changes in Federal Tax Laws and Rules
The Patient Protection and Affordable Care Act drove the high ranking of this issue. Unpredictability and hidden changes in the tax law creates compliance costs, time and fees, which are a hidden tax on small firms.
The material presented here is educational in nature and is not intended to be, nor should be relied upon, as legal or financial advice. Please consult with an attorney or financial professional for advice.