The Concord Monitor had an article concerning the LLC tax that the Democrats, lead by socialist leaning Susan Almy, are trying to use to paper over their overspending ways:
When Andy Sanborn started his first company, he recalls sleeping on the floor on an air mattress eating ramen noodles. Now, Sanborn owns The Draft in Concord, along with a couple of real estate companies. He won’t say how much money he makes, but he is outraged at the thought of the government telling him what salary is considered "reasonable."
"Should government have the right and authority to tell people how much money they can make?" Sanborn said. "It’s insulting. If my wife works at Concord Hospital and makes $300,000 a year, no one blinks. If I make $300,000, I have to justify it to New Hampshire."
For decades, business owners have been required to calculate "reasonable compensation" for federal and state tax purposes. But as state legislators work to clarify those laws, the discussion about what is reasonable compensation has come to the forefront. To the chagrin of those involved in the technicalities of tax law, the discussion is intimately tied to the controversial expansion of the state’s interest and dividends tax to limited liability companies. Tax practitioners and politicians must walk a fine line between reforming the standards for calculating the tax deduction while not trampling on free market values.
"It’s a very personal and emotional issue," said David Heath, tax director at the Nashua accounting firm Melanson Heath, who supports pending legislation to clarify the laws. "The bottom line is the determination of compensation for an individual is best determined by the business’s customers and the business environment in which they’re in, not by some governmental agency."…
…The increasing numbers of audits angers businessmen like Sanborn. "It’s a 180 degree reversal of the law," Sanborn said. "The shield to protect us has become the shield they’re hitting us with."
The above describes the story – the State trying to determine who can earn what rather than the marketplace; but that is only part of the story about the story (read the rest of the piece). This is a perfect example of how the mainstream (aka statist or leftist) media tries to "frame the debate" and set the terms of any discussion by unspoken assumptions. What an interesting, learned article! It gets opinions from all sides! It so very even-handedly examines the "serious problems" that must be solved by our wise legislators! Look at the phrases sprinkled throughout the article: The article says there is "a need for clearer standards" with respect to the LLC tax. It insightfully notes that "part of the problem is that every business has unique circumstances," and then comes to the triumphant conclusion that our wise state legislators are "working hard" to come up with "legislative changes that could help create a clearer standard."
May I use unusually strong language? I must say poppycock!
Sorry for the over-the-top invective… :–) …but the biased Concord Monitor says nothing about the obvious solution to the problem (which, by the way is caused entirely by government overspending and the political class that drives it): Repeal both the LLC tax AND the corporate income tax. (Corporations simply pass any taxes along to the consumers in their price structures anyway. It takes economically illiterate politicians to miss that simple fact.) See? Wasn’t that easy? The LLC tax is driven by a state supreme court decision (the judges for which are sometimes called "politicians in black robes") that is based on the existence of the state corporate income tax (referred to by the delicate political lie known as "corporate profits tax"). Why have a corporate "profits tax" at all? Is it because "the state desperately needs the money," as we’re always told? That’s BS. The state doesn’t need the money. The problem is that Gov. Lynch and the majority Democrats in the state legislature have overspent the state into a historically unprecedented $500 million budget deficit. STOP THE SPENDING, FOOLS. And while you’re at it, abolish the anti-business, jobs-killing "corporate profits tax" as well as the unfair LLC tax.
Problem solved. Stop the insane overspending and abolish the taxes and help drive the overspending.
Then our fight will be what it should always be: How to stop the politicians who get fat off our taxes from grabbing an ever greater slice of private sector wealth. After all, we know that a reasonable-sized state government doesn’t need the millions and millions of dollars generated by the 70 or more increases in taxes and fees the Democrats have passed in the last two sessions. It didn’t need such vast amounts of wealth just a few short years ago. Why now? And besides, we know that if we give it to them they’ll just squander it and then demand more. Much more. So let’s stop them right now. We can start with a promise to abolish both the LLC tax and the harmful corporate income tax.