There are a lot of regulatory issues that weigh on the minds of small business owners, from payroll rules to healthcare reform. But new research from Paychex suggests there is one legislative topic in particular that SMBs prioritize.
According to the Paychex Small Business Survey conducted late last month by the firm, tax law is top-of-mind when small businesses consider federal legislation that could impact the SMB community. It’s not just about tax cuts, either, though small business owners certainly want that: These business owners have several concerns about national tax policy.
Separate research from Bibby Financial Services, also released last week in its Global Business Monitor Report, similarly found that U.S. small businesses are paying close attention to regulation and places that trend in the context of broader optimism among the small business community when it comes to the economy.
PYMNTS takes a look at the findings from both reports below.
-67 percent of SMBs describe the current U.S. economy as “positive,” according to Bibby Financial Services (BFS), with 39 percent expecting the economy to continue to improve. The percentage of businesses expressing concern over the economic outlook of the U.S. has also declined from 2016, researchers said.
-49 percent of SMBs say sales have grown in the last year, up from 36 percent in 2016, with 63 percent expecting sales to grow in the next year, too. Just 7 percent expect sales to decline.
-49 percent identify government regulations as their biggest challenge to growth, BFS’ report said, making this topic the largest for small businesses, followed by rising overheads and costs (cited by 48 percent). While 44 percent of SMBs say they view the current regulatory climate is favorable, 45 percent said it was unfavorable.
-66 percent of SMBs anticipate little-to-no impact from further interest rate increases from the Federal Reserve. A quarter said they are using external finance to propel their businesses (up from 22 percent in 2016). Nearly half (49 percent) said access to finance in the current market is good.
-41 percent of small businesses surveyed by Paychex want the Trump administration to make tax reform its top priority. Forty percent said they would like to see a lower tax rate as a result of federal focus on tax policy, the report found. Small businesses want the Trump administration to focus on tax policy more than healthcare reform, infrastructure and reducing regulations (cited by 15 percent, 15 percent and 9 percent, respectively, as top focuses for small businesses).
-27 percent of SMBs told Paychex that they want the Trump administration to get rid of special interest tax loopholes for large corporates, suggesting small businesses are interested in tax reform for more reasons than to simply obtain a lower tax rate. Further, 21 percent said they want a more simplified tax code. Only 12 percent said they would not benefit from tax reform. “President Trump ran on the promise of creating a more business-friendly environment,” reflected Paychex President and CEO Martin Mucci in a statement. “Our data indicates businesses see changes to the tax code as a top priority, and they’re anxiously awaiting what reform may come over the next several months.”
-55 percent of small business owners said regulatory ambiguity and uncertainty is having, at least, somewhat of an impact on their businesses, when asked if this ambiguity negatively impacted their profitability or ability to grow.