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View Diary: Steven Rattner offers ideas on raising tax revenue and I respond (72 comments)

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  •  It is an interesting subject. (15+ / 0-)

    I think there are both employee and revenue implications of what the threshold of a non-small business should be. In many, many, probably even most mature (e.g., consolidated) industries, a business with 300 employees and $70M in revenue is considered a small business...

    And perhaps a third metric should be $ revenue per employee, and a fourth could be the value of the top compensation package.

    For example, one model could be, if a business exceeds one of the following, then it is not a small business:

    1) 400 employees
    2) $100M in gross revenue
    3) $250K per employee
    4) $2M top compensation package

    Another metric could be market share...

    And then there might be a value in defining a VERY SMALL business for those that have less than ALL of the following:

    1) 30 employees
    2) $1.5M in revenue
    3) $150K per employee
    4) $250K in top compensation package

    Comments???

    The Class, Terror and Climate Wars are indivisible and the short-term outcome will affect the planet for centuries.

    by Words In Action on Sun Nov 25, 2012 at 07:46:52 AM PST

    [ Parent ]

    •  The only problem I have with your definitions (10+ / 0-)

      is the revenue per employee. Under your model, my small retail business is very close to not being considered a small business. We gross just over $700,000 per year, have 2 full-time employees (my husband and me), and 3 part-time employees who are the equivalent of 1 full-time employee. The top compensation package is in the mid 5 figures (well below 2 million!), and yet at $250K per employee, we are skirting the edges of not being a small business. I think net revenue has to be factored in somehow, recognizing that net revenue can be manipulated to some extent. Or raise the revenue per employee figure to recognize small businesses that are doing well, but aren't making its owners millionaires.

      Otherwise, I like what you've put together.

      A society grows great when old men plant trees in whose shade they know they shall never sit. - Greek proverb

      by marleycat on Sun Nov 25, 2012 at 08:27:08 AM PST

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      •  You make a good point. (4+ / 0-)

        As you say, though, working with "net" numbers is dicey. To some extent, pretty much all businesses are trying to eliminate taxable income.

        The Class, Terror and Climate Wars are indivisible and the short-term outcome will affect the planet for centuries.

        by Words In Action on Sun Nov 25, 2012 at 10:52:21 AM PST

        [ Parent ]

        •  Why does SMALL business deserve a tax break? (0+ / 0-)

          I question the basic premise.

          Yes, small businesses generate a lot of jobs. But do they generate more jobs per dollar of revenue than big businesses? If not, then why exactly should small business get a subsidy?

          Economies of scale allow big businesses to deliver a competitive product at a low price. This leaves more disposable income in customers' pockets.

          I am well aware of the severe failings of Walmart. But Costco, another big business, treats its employees much better and still delivers bargains to millions of customers. If we want to require businesses to treat employees decently, I'm all for that--so let's just have rules that require decent treatment of employees, for big and small businesses alike.

          I patronize a number of small businesses because I like the personal service I get. But that's my choice; I don't think my choice deserves a tax break.

          I say, let the market sort out whether businesses work better big or small.

          "The true strength of our nation comes not from the might of our arms or the scale of our wealth, but from the enduring power of our ideals." - Barack Obama

          by HeyMikey on Mon Nov 26, 2012 at 03:55:05 PM PST

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      •  Instead of net revenue (2+ / 0-)
        Recommended by:
        marleycat, 207wickedgood

        Use value added.

        Subtract all inventory purchases and other product-related purchases from the revenue. That is the value that you and your employees have added to the business.

        The GOP is the party of mammon. They mock what Jesus taught.

        by freelunch on Sun Nov 25, 2012 at 01:43:37 PM PST

        [ Parent ]

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