Economic Stimulus for Small Businesses
Obama proposed this week that he will help small businesses by reducing capital gains taxes and encouraging investment through SBA programs.
Reducing or even eliminating capital gains taxes is great for businesses that have something to sell like real estate - maybe it's worth more if you bought it 15+ years ago, but how does this help any business that recently bought commercial real estate and is now underwater? And by no means is there an active set of buyers out there for commercial real estate - maybe some sharks circling.
The SBA programs are only good for real estate aquisitions. And they are very good if you happen to have a profitable business that wants to take on more risk and aquire real estate. More than likely, a small business aquiring more real estate today is making a long term commitment to a location and a business model, and crossing their fingers that it will work. That certainly characterizes our business at Nova.
Cash for caulkers? Well, that might be a good idea for those businesses in the insulation and caulking supply - Home Depot, Lowes, your local lumber yard, etc. And it is certainly good for people to do energy savings projects to their homes. I support this idea, but feel it is still very limited in its scope.
Personally, I like concept of the Canadian initiative, valid thru January 2010, which allows a 15% tax credit on home improvement projects over $1K and up to a $10K. I think it is prudent to encourage people to invest in their homes. We could use a similar plan here in the U.S., especially considering all the out-of-work construction tradespeople.
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