Small business wins a few, loses a few in a flurry of last-minute activity
Sine die is Latin meaning with no further meetings planned and for small-business owners possibly the most beautiful term in the language.
After a whirlwind of activity in the week preceding the June 15 sine die of the Colorado General Assembly, small business came away with some good news and some bad.
Small Business Tax Deduction Saved
House Bill 1420, the misnamed ‘Fair Tax Act,’ would have de-coupled state tax calculations from your federal calculation by prohibiting future use of the 199A small-business tax deduction of 20% of business income. A deduction that had led to record highs in hiring, worker pay, and business expansion — pre-coronavirus. For tax year 2019, the federal qualified business income (QBI) threshold (for the 20% deduction – regardless of industry) is $160,700 individual/$321,400 joint. For the next two years, those amounts will be $500,000.00 and $1 Million dollars on the Colorado tax form. The lowering of these thresholds would have been devastating to smaller businesses.
The voices of NFIB Colorado and a coalition of other business groups were loud enough to force HB 1420 to be amended to keep 99% of small-business owners out of harm’s way. Thanks to the use of Voter Voice, legislators heard from over 400 NFIB Colorado members crying out against the original version of HB 1420.
Paid Sick Leave Bill Moderated
Following the 2018 election, the progressive majority that took control of the Legislature made paid sick leave one of its marquee issues. With the help of NFIB research showing 73% of small-business owners already offering paid time off – and for any reason – NFIB, working with State Rep. Colin Larson, successfully lobbied to have Senate Bill 205 amended to exclude smaller enterprises with 15 or fewer employees from complying. This followed an NFIB effort to have the bill defeated. Employers of 16 or more employees will still have a huge operational cost increase hit them at a time they can least afford it.
Non-Legislative Victories
- Earlier this month a Colorado court handed entrepreneurship a partial win when it, in essence, ruled that lack of industry-specific experience should not be a barrier to keep entrepreneurs from participating in enterprises unrelated to what they know or do. Click here to read more.
- NFIB testimony contributed to the state’s Division of Labor Standards and Statistics putting a pause on its idea to go where no state has gone before in amending its joint-employer rule. More about that can be read here.
Bad for Small Business Bills That Passed
- A health-insurance tax that slaps a 3% increase on all health-insurance policies passed
- A new state-run retirement account for employees without a retirement plan was established that, as of now, will be contributed to by just the employee. The state will hire a third party to administer the new law. However, while language in the bill precludes liability on behalf of employers, questions are still being asked if states have the authority to grant a safe harbor to employers for IRA types of plans. NFIB will re-double its efforts to have such protection put into the law, if necessary, when the Legislature next convenes.
Keep up with the latest Colorado small-business news at www.nfib.com/colorado or by following NFIB on Twitter @NFIB_CO or on Facebook @NFIB.CO
