Exposing the Small Business SCAM

According to the Republican tax logic, a small number of owners is the sole criterion for a "small business." Such businesses, which according to the Joint Committee on Taxation accounted for 94 percent of all U.S. businesses in 2007, include partnerships, sole proprietorships and S corporations, a designation that allows owners to report profits and losses on their personal tax return, rather than on the company's.

"'Small business' is a brand name," MSNBC's Keith Olbermann said.

The report found that businesses with billions of dollars in annual revenue fall under the small business category. Bechtel, a global engineering and construction company that is considered a "small business" under this logic, took in $31 billion last year. Ferrellgas, a propane company, earned $2 billion in revenue last year. McIlhenny, another "small business," which makes Tabasco sauce, made $250 in revenue in 2007.

Other names include auditing firm PricewaterhouseCoopers and private equity firm Kohlberg Kravis Roberts. Also on the list are the collection of "small businesses" owned by the billionaire Koch Brothers, who this year tied for fifth on the Forbes list of wealthiest Americans, and who were profiled last month by Jane Mayer in The New Yorker.

Bloomberg first reported this unusual tax logic on Monday. The Republican "small business" designation, the report said, would apply even to individuals with no employees at all. It could include actors, athletes and authors -- even President Obama.

http://www.huffingtonpost.com/2010/09/23/olbermann-small-business_n_736418.html

And before people jump all over the MSNBC soourcing, note that teh WSJ, Bloomberg, Politifact, and factcheck.org have all said the same thing. That is, individuals who get pass-through income, as well as the above "small businesses" are in the GOP definition, and thus its impossible to say that 50% of small business "profits" come from firms employing under 500 or 250 or whatever definition you might use.

No definitive measure exists, not from the chamber of commerce or anyone else. Just this IRS definition, and the IRS itself said (under Bush) it was misleading.

Independent researchers hae also found that start up companies, not small businesses, create most of the jobs. So raising taxes on "small" businesses will not affect jobs.