2003 Press Releases

Stimulus Package Will Spur Micro-Business Growth, Economy
Expensing, Individual Income Tax Rate Reductions Encourage Investment

Washington, D.C., May 23, 2003 -- Two provisions in the economic stimulus package passed by Congress this morning will spur growth among the self-employed and entrepreneurs as key drivers of jobs and innovations in the market place, according to the largest micro-business trade group.

“Increasing the amount of equipment a micro-business owner can expense, and accelerating the individual income tax rate reductions frees up capital that the self-employed and micro-business owners can reinvest in their businesses,” said Robert Hughes, president of the National Association for the Self-Employed (NASE).

The $350 billion tax cut plan provides for an increase in the amount small businesses can expense for equipment purchases from the current $25,000 to $100,000, and accelerates the depreciation timetable for equipment such as computers and software. The accelerated reduction in individual income tax rates is retroactive to the beginning of 2003, with workers seeing an increase in their take-home pay starting July1. Both provisions sunset in a few years.

“Nearly 18 million Americans are self-employed or own a business with ten or less employees,” Hughes said. “Yet despite their small size, entrepreneurial firms have leveraged flexibility and entrepreneurship to ignite one of the most remarkable eras of innovation and expansion in our nation’s history. With these tax provisions, micro-businesses marshal their resources and grow the American economy by doing what they do best - create, innovate, produce, build and grow.”

Data from the National Science Foundation and the U.S. Department of Commerce show that small entrepreneurial firms have been responsible for 95 percent of all radical innovation in the United States in the past half century and that smaller firms have generated 24 times as many innovations per R&D dollar as larger corporations with more than 10,000 employees.

Along with innovation, micro-firms have driven job growth. According to the Small Business Administration, micro-businesses created well over a third of all new jobs to the economy between 1998 and 1999. The latest U.S. Census report shows that these firms employ more than 12.3 million workers with a total annual payroll of more than $309.7 billion. Approximately 21 million Americans are engaged in some entrepreneurial activity, including full and part-time entrepreneurship.


The stimulus package’s small-business expensing provision was part of a priority plan that the NASE proposed to Congress earlier this year. The NASE plan focused on measures that would spur micro-business growth.

“Micro-businesses have been pillars of innovation, integrity and reliability, fueling much of what is great about America,” said Hughes. “I am glad this stimulus package recognizes and rewards their contribution. But, I urge Congress to contemplate the immeasurable role micro- businesses play in the creation of jobs and in the ideas and innovations that are inherent to a growing economy, and make the small business provisions permanent.”

The stimulus package, which now heads to President Bush to sign into law, also includes a capital gains tax reduction, and accelerates the expansion of the child tax credit and elimination of the “marriage penalty.”
“This bill I'm going to sign is good for American workers, it is good for American families, it is good for American investors, and it's good for American entrepreneurs and small-business owners,” President Bush said.

About the NASE
The National Association for the Self-Employed (NASE) is the nation’s leading resource for the self-employed and micro-businesses, bringing a broad range of benefits to help entrepreneurs succeed and to drive the continued growth of this vital segment of the American economy. The NASE is a 501(c) (6) non-profit organization and provides big-business advantages to hundreds of thousands of micro-businesses across the United States. For more information, visit the association’s web site at www.nase.org.

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