Small-business owner confidence continues to drag, according to the National Federation of Independent Business Small Business Optimism Index.
The Index gained 0.9 points, rising to 88.9, failing to regain the losses caused by last month’s “fiscal cliff” scare, according to a report released this week.

Expectations for improved business conditions increased by five points, but remain overwhelmingly low—negative 30 percent—the fourth lowest reading in survey history. Actual job creation and job creation plans improved nominally, but still not enough to keep up with population growth.

By T.W. Farnam and Tom Hamburger - The Washington Post

WASHINGTON – Small businesses, like the family-owned diner and the Main Street hardware store, are iconic images of America’s entrepreneurial spirit. Now, as President Barack Obama and lawmakers seek to negotiate a deal on taxes and federal spending to avert a year-end budget crisis, both political parties and a range of outside advocates are claiming they best represent the interests of small business.

But politicians and interest groups have twisted the definition of “small business” as they seek an advantage in the debate over whose taxes to raise. Those who claim to speak for small business often represent only a narrow slice of that broad sector, if they represent it at all. And groups that are truly composed of small firms often are allied with advocates on the political right or left whose interests bear little resemblance to those of mom-and-pop stores.

At the heart of the debate is whether tax rates should increase for top-end taxpayers, as Obama has long urged. Most small businesses pay taxes according to individual rates, not corporate rates, so some firms would see their taxes increase if upper-end rates are raised.

Dane Stangler has never owned a small business, and doesn't expect to ever own one. But he's in a position to understand the challenges facing people who own small companies.
Stangler, director of Research & Policy department at the Ewing Marion Kaufmann Foundation, talks with The Associated Press as Congress was haggling about the fiscal cliff, the combination of billions of dollars in tax increases and budget cuts scheduled to go into effect Jan. 1. Economists have warned that if Congress doesn't prevent those tax increases and budget cuts from going into effect, the country will be at risk of going into a recession. And it's believed that small businesses would suffer the most.

By Tiffany Hsu - Los Angeles Times

The job outlook at America’s small businesses is the worst it’s ever been, according to the new Gallup Small Business Index.

Last month, 21 percent of small-business owners said they expected to lower head count over the next six months – the highest percentage recorded by the Wells Fargo/Gallup Small Business Index since its launch in 2003. In July, the last time the data was compiled, 10 percent of bosses said they planned to shrink employee ranks.

Big business and small business have different views on whether changes to personal income taxes or corporate taxes should be part of the effort to address the so called “fiscal cliff.”

The issue is that some businesses that declare their business income through their personal income taxes face the possibility of higher tax rates on top tiers of personal income. Meanwhile, big corporations would be unaffected by the higher tax rates since they pay corporate income taxes, not personal.  Those corporations support lowering the corporate tax rate.

Read the entire story here.