Congress Raises Minimum Wage, Considers Online Sales Tax
By Staff -- Gifts and Dec, 5/28/2007 10:47:00 AM
Washington, DC — Congress approved an increase in the federal minimum wage from $5.15 to $7.25 an hour over the next two years. A spokesman for President Bush said he would sign the bill.
The wage hike was attached to an emergency spending bill for the Iraq war, and includes $4.8 billion in business tax breaks over 10 years. These include extending a law that allows small business to quickly deduct $112,000 for equipment purchases and raising the amount to $125,000; allowing married couples who operate unincorporated businesses to file as sole proprietorships; and offering tax incentives for rebuilding areas damaged by Hurricane Katrina.
More than half the sum would be used to extend and expand a tax-credit program for employers who hire former welfare recipients, at-risk youths and other targeted groups, according to The Washington Post.
The Post cited a recent PNC Economic Outlook survey, which found that one-third of retail and wholesale business owners said the wage hike would force them to raise prices, limit hiring, cut staff or reduce health-care benefits.
Meanwhile, Sen. Michael Enzi (R-WY) introduced the Sales Tax Fairness and Simplification Act, which would require online retailers to collect state sales taxes even if they don’t have a store, warehouse or office in the state. It would exempt online businesses with annual revenue of less than $5 million. Enzi unsuccessfully attempted to pass a similar bill in 2005.
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