While President Obama's State of the Union address on Tuesday night mentioned little in the way of LGBT equality legislation, aside from a jubilant reference to the successful repeal of Don't Ask, Don't Tell, there is still cause for excitement for LGBT business owners—the president spent much of his speech laying out a vision for job growth and increasing U.S. competitiveness in the global economy.
Among the president's proposals was a review of regulations that hamper small businesses from growing or remaining competitive. Of particular interest to the NGLCC and other business advocacy organizations was the president's mention of repealing an onerous tax issue for businesses that is a part of the new health reform law and would take affect in 2012. Referred to as the "1099 issue" by advocates and members of Congress, the provision requires both large corporations and small businesses to report to the IRS payments of more than $600 a year to any vendor.
As the law stands now, businesses must file 1099-MISC forms only for freelancers and other service providers that aren't incorporated. However, the new rule will expand such reporting to include payments to not only freelancers, but also to companies that are incorporated. In addition, the existing law would make businesses now file a 1099 for goods as well as services. This means businesses will need to get tax ID numbers and file forms for almost every supplier they have, thus forcing them to track all their small expenses in order to account for which vendors meet the $600 annual threshold.
"This provision means that small businesses will be buried in a mountain of paperwork to account for everything from purchasing office supplies and equipment to sending UPS packages and company travel," said Justin Nelson, NGLCC co-founder and president. "We look forward to working with the president and Congress to repeal this provision."
The president also proposed to freeze domestic spending for five years.
"If adopted, my proposal would reduce the deficit by more than $400 billion over the next decade, and will bring discretionary spending to the lowest share of our economy since Dwight Eisenhower was president," Obama said in his address.
The NGLCC noted that while prospects for passage of meaningful LGBT equality legislation were dim, there was still much that can and will be done at the federal agency level. The NGLCC sighted the organization's recent memorandum of understanding (MOU) with the U.S. Department of Commerce that will, among other things, open opportunities for LGBT business to sell goods and services to the agency.
Other recent administrative developments include the finalization of a U.S. Health and Human Services rule allowing for hospital visitation for same-sex couples, and the proposed rule from the U.S. Department of Housing and Urban Affairs to ensure equal access to housing regardless of sexual orientation or gender identity.
"We will continue our push to open opportunities for LGBT businesses to bid for federal contracts and we look forward to working with other LGBT advocacy organizations, the White House and federal agencies to make additional positive changes in all aspects of the lives of LGBT Americans and our families," said Chance Mitchell, NGLCC CEO and co-founder.
The president also focused on his national export initiative aimed at doubling U.S. exports in the next five years. Obama noted that he would be visiting several countries over the next few months in order to further nurture a positive trade environment for U.S. exporters.
Among the countries mentioned were Colombia and Brazil, the nations chosen for NGLCC's 2011 trade mission later this year. This will mark the second annual trade mission hosted by the NGLCC aimed at opening up business opportunities for LGBT businesses beyond U.S. boarders.
"Ninety-five percent of the world's consumers live outside the United States," Nelson said. "We are eager to gain new markets for our members, and we look forward to continuing our work with the administration to grow exports."
