The Government Accountability Office (GAO) released aВ report showing that very few small businesses are taking advantage of small business tax credits, included in the PresidentвЂ™s health spending law, due to how difficult and confusing it is to claim those credits.В U.S. Senator Orrin Hatch (R-Utah), Ranking Member of the Senate Finance Committee, said this report shows how bad the law is for small businesses, since these tax credits are supposed to help them, and how much worse it will be if the law comes fully into effect in 2014.
вЂњThe failure of these small business tax credits goes to the heart of whatвЂ™s wrong with ObamaCare:В itвЂ™s confusing, expensive, and burdensome for the families and businesses that have to comply with it.В ItвЂ™s no surprise that the very part of the law that the White House said would help small businesses is, in fact, too difficult and complex for small businesses to take advantage of вЂ“ and thatвЂ™s before the worst parts of the law for AmericaвЂ™s job creators come into effect.В This would be ironic if it werenвЂ™t such a tragic indictment of the PresidentвЂ™s failed health law,вЂќ said Hatch.В вЂњInstead of admitting that this is a yet another failure, the President wants to expand this program so he can say heвЂ™s doing something for AmericaвЂ™s small businesses.вЂќ
The PresidentвЂ™s Council of Economic Advisors estimated thatВ вЂњ4 million small businesses are eligible for the credit if they provide health care to their workers.вЂќ Yet, GAO found in itsВ report that only 170,300 small employers have claimed it.В In large part, this was due to the incredibly complex formulae for determining which employers are eligible for the credit, and how much they are eligible for.В The GAO report вЂњfound the tax credit to be complicated, deterring small employers from claiming itвЂќ and said the complexity,В вЂњarises from the various eligibility requirements, the various data that must be recorded and collected, and number of worksheets to be completed.вЂќ
GAOвЂ™s findings mirror those of a November 2011 Treasury Inspector General for Tax AdministrationВ report that found that, вЂњthe number of claims for the small business health care tax credit was much lower than anticipated.вЂќ Despite the complexity and low participation in the tax credit the AdministrationВ proposed to вЂњexpand the group of employers eligible for the creditвЂ¦.вЂќВ as part of its budget proposal for fiscal year 2013.