WASHINGTON, Oct. 3, 2011-The International Franchise Association today urged the Joint Special Committee on Deficit Reduction, or Super Committee, to consider tax reforms that encourage job creation by franchise businesses, but do not hurt small businesses and franchisees that file as individuals, as it works toward its stated goal of achieving at least $1.5 trillion in budgetary savings over 10 years from spending cuts or tax revenue.

“IFA believes the Super Committee must view reforms through a lens that ensures businesses of all sizes, and particularly small businesses like the majority of franchise businesses, are given long-term certainty and clarity regarding their future tax rates,” said IFA President & CEO Steve Caldeira. “As the Special Committee debates comprehensive tax reform, it is essential that corporate tax revisions not be enacted that would impede or stifle small business growth, especially given that many of our country’s small businesses file taxes as individuals.”

In a letter delivered to Super Committee members and members of the House Ways & Means and Senate Finance Committees, IFA cautioned against proposals that only consider corporate tax reform that will result in significant tax increases on IFA members who file taxes at the individual rate. IFA members’ taxes, including many franchisees’ taxes, will increase if most business deductions are eliminated as part of corporate tax reform. Franchise businesses also face the prospect of the higher tax rates after 2012 when individual tax rates could be as high as 39.6 percent and in 2013 when the 3.8 percent surtax on “unearned” net investment income takes effect to help pay for Medicare.

“If most or all of the business deductions are eliminated in an effort to lower the overall corporate rate, it will leave all the so-called “pass-through” taxpayers (including “S” corporations and partnerships) exposed to significantly higher taxes without the benefit of a lower rate,” said Caldeira. “We respectfully urge that you consider the effects of these proposals on the small franchise business owners who reside on virtually every Main Street in America.”

To view a copy of the letter, please

click here

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About the International Franchise Association

The International Franchise Association is the world’s oldest and largest organization representing franchising worldwide. Celebrating 50 years of excellence, education and advocacy, IFA protects, enhances and promotes franchising through government relations, media relations and educational programs. Through its awareness campaign highlighting the theme,
Franchising: Building Local Businesses, One Opportunity at a Time,IFA promotes the nearly 18 million jobs and $2.1 trillion of economic activity generated by franchising. IFA members include franchise companies in over 100 different business format categories, individual franchisees and companies that support the industry in marketing, law and business development.