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September Jobs REPORT Highlights Need for Long-Term Tax Reform for Small Businesses

For immediate release
Contact:
Alisa Harrison, 202-628-8000
Matthew Haller, 202-662-0770
aharrison@franchise.org
mhaller@franchise.org
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WASHINGTON, Oct. 7- Steve Caldeira, President & CEO of the International Franchise Association (IFA), the largest trade group representing franchising worldwide, an industry with more than 825,000 franchise small businesses across 300 business lines providing for nearly 18 million jobs and $2.1 trillion in economic output, released the following statement following the September U.S. Department of Labor employment report showing 103,000 jobs were created.   

"Franchise businesses can be one of the key solutions to the unemployment crisis facing this country, as evidenced by the industry's demonstrable 40 percent growth rate over the last decade, if given long-term certainty regarding the future of tax rates for both corporations and individuals. Despite a slightly positive jobs report this month, only a return to pro-growth policies will truly enable franchise small business owners to invest capital to open new franchises and create new jobs in the long-term."  

"We urge members of Congress, and specifically the members of the Super Committee, to consider tax reforms that encourage job creation by franchise businesses, but do not hurt small businesses and franchisees that file as individuals, as it works toward its stated goal of achieving at least $1.5 trillion in budgetary savings over 10 years from spending cuts or tax revenue. IFA members' taxes, including many franchisees' taxes, will increase if most business deductions are eliminated as part of corporate tax reform. Franchise businesses also face the prospect of the higher tax rates after 2012 when individual tax rates could be as high as 39.6 percent and in 2013 when the 3.8 percent surtax on "unearned" net investment income takes effect to help pay for Medicare."  

IFA's latest Business Leader Outlook Survey shows a majority of franchise business leaders continue to expect conditions to stay the same or worsen since the previous survey conducted in March. In the most recent data, only 47.3 percent said they expect their business to do better this year as compared to last year, down from 54.9 percent in March.   

About the International Franchise Association  

The International Franchise Association is the world's oldest and largest organization representing franchising worldwide. Celebrating 50 years of excellence, education and advocacy, IFA protects, enhances and promotes franchising through government relations, public relations and educational programs. Through its awareness campaign highlighting the theme, Franchising: Building Local Businesses, One Opportunity at a Time, IFA promotes the nearly 18 million jobs and $2.1 trillion of economic activity generated by franchising. IFA members include franchise companies in over 90 different business format categories, individual franchisees and companies that support the industry in marketing, law and business development.