Recovering Economy Burdens Business Owners with Higher Taxes
Entrepreneurs, no matter where they go and what they do, can’t escape taxes. Business owners, regardless of their type, size or industry of the venture they are running, are mandated by law to pay up. In the wake of a recovering economy, heavier taxes are keeping businesses on their toes.
Experts recognize that there is no easy way to deal with skyrocketing taxes evenwill have to deal with and pay promptly. It is important for business owners to keep their records organized to properly monitor every cent of the tax amount involved. In this regard, doing it alone may not always work. It is important to tap the expertise of an accountant who is better equipped to lay out the details and make the business owner understand every aspect of the tax-paying duty.
Tax paying can be messy, particularly when personal and business accounts are being mixed up. This is particularly true for owners of startups and small-scale businesses. It is important to properly account for the money that goes in and out only of the enterprise.
The insinuation on taxes (apart from death) being a certain thing in this world – and ever-increasing at that – is now becoming a real scenario for businesses as the U.S. and global economy prove to be in the recovery phase, if experts are to be believed.
With the economy currently on the rebound from the 18-month long recession, better sales are expected. Businesses are boldly taking risks with increased capitalization and are now open to borrowing from banks and lending institutions in an effort to expand amidst the economy that promises to provide a better business environment.
Given the influx of tax changes in a recovering economy, business owners are being encouraged to pay more attention to the essentials of taxation. Being informed and updated better equips a business owner to dealing with the mandatory payments as required by the government.
In a report by The Washington Post, the jump in business taxes was at $671 billion or 4.3%from the previous year:
State and local tax bills for companies across the country grew modestly last year as the economic recovery accelerated, according to new research released last week, and Washington-area firms were no exception. District, Maryland and Virginia businesses collectively paid $27.6 billion to state and local coffers in fiscal 2013, an increase of 3.8 percent over the $26.6 billion collected in 2012.
Businesses’ state and local tax burdens last year expanded by 4.3 percent, to $671 billion, compared with 3.9 percent the year before, and it was the third consecutive year of growth after back-to-back years of shrinking bills in 2009 and 2010.
In the State of Ohio, businesses saw an increase of nearly 4% in their local and state taxes.Dayton Business Journal sheds light on the story:
Ohio businesses paid 3.7 percent more in state and local taxes last year, compared to the previous year. The good news is that’s less than the national average, where those taxes jumped 4.3 percent nationally, according to an annual study prepared by Ernst & Young LLP in conjunction with the Council On State Taxation.
In total, Ohio companies shelled out $20 billion in state and local taxes in 2013. That amounts to 40 percent of all local and state taxes collected throughout the state.
While the percentage is high, it again is lower than the national average of 45 percent of all local and state taxes.
The study reinforces the important of the business community to the overall functionality of a state.
Across the country, businesses paid roughly $671 billion in state and local taxes in 2013.
Photo by Alan Cleaver