WASHINGTON -- Small business owners received two seemingly contradictory messages on Wednesday from Republican presidential candidate Mitt Romney, campaigning in Ohio.
The first message, delivered early in the day in Westerville, was that small business owners should "not be expecting a huge cut in taxes." The second message, delivered later in Shaker Heights, was that "small business is crushed by taxes," and that Romney plans to bring "tax rates down for small business."
The discrepancy illustrates a conundrum facing the Romney campaign as it barnstorms through a state many Republicans view as a "must-win:" How to sell an economic plan built upon income tax cuts for wealthy Americans and business owners as a way to spur hiring to voters who are more likely to work for businesses than to own them.
Small business owners are a major component of Romney's campaign message -- examples are present in nearly every stump speech -- where they help illustrate who stands to benefit from his proposed foreign policy, economic plans, and regulatory reforms.
Romney's small business-focused pitch started off fine Wednesday morning, according to The Huffington Post's Sam Stein, who reported that Romney told the crowd, "We have got to reform our tax system. Small businesses most typically pay taxes at the individual tax rate. And so our individual income taxes are the ones I want to reform. Make them simpler. I want to bring the rates down."
But then he switched his message. "By the way, don't be expecting a huge cut in taxes because I'm also going to lower deductions and exemptions," Romney said. "But by bringing rates down we will be able to let small businesses keep more of their money so they can hire more people."
By the afternoon, however, the line about how people shouldn't expect "a huge cut in taxes," was gone, replaced with a story of an unnamed owner of an unidentified small business in St. Louis, who Romney said, "calculated how much of what his business makes goes to taxes every year. Federal income taxes, federal payroll taxes, state income taxes, state sales taxes, highway taxes -- gasoline taxes, that is -- and the like. He added it all up, and it was over half of what he made was going to tax."
Shortly after the event, the Romney campaign issued a press release highlighting this section of his remarks.
Romney argued that President Barack Obama's plan to let the Bush-era tax cuts expire for people with more than $250,000 in annual income would hurt small business owners. The Internal Revenue Service, however, reported that only about 3 percent of small business owners would be adversely affected if the tax cuts expire.
Romney's argument appeared geared toward convincing voters that taxes would increase on small business revenues, leaving them less money to invest in new employees. But that's not what's being proposed. Letting the Bush tax cuts expire would affect only those business owners, and others, who make more than $250,000 in take-home pay.
Nevertheless, Romney's argument is appealing to some Ohio voters, like Cynthia Beitman of Westerville. "People run small businesses," Beitmann said to HuffPost, explaining that she doesn't mind if middle-class Americans like her get fewer deductions and exemptions on their taxes, as long as Romney lowers tax rates for small businesses.
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