The family business Spokane is concerned about Biden | ‘s tax plans Washington

(The Center Square) – A new video series from the National Federation of Independent Business features small business owners from across the country expressing concerns about President Joe Biden’s tax proposals and the impact it has on their survivability.

The latest issue, titled “In Her Own Words,” features Mike Gilmartin, CEO of Commercial Creamery in Spokane. The family company, founded in 1908, produces cheese powder, special milk powder and spices for snacks, sauces and dips.

Gilmartin is particularly concerned about Biden’s call for Congress to abolish the so-called “tiered base” in calculating capital gains taxes.

As in tax law, the provision can be confusing. For example, if you bought $ 100,000 worth of stock and later sold it for $ 250,000, the base would be $ 100,000 and you owe capital gains tax on the profit of $ 150,000. If you kept the stock and it was worth $ 500,000 at the time of your death, it would increase the base to that $ 500,000 – its current market value – and save your heirs a heavy capital gains tax.

“Hitting this generation with a tax change, not a top-up, well, I wasn’t planning on doing that,” Gilmartin says in the video. “And there is no way my kids will be able to make that money.”

The company’s third generation shares are held internally.

“It could be a slippery slope,” said Gilmartin. “You’d probably have to bring in an outside investor to keep the company going and then the family would lose control.”

Commercial Creamery has 10 employees at its headquarters in Spokane and an additional 130 at its Idaho manufacturing facility.

The Biden government announced a study that said the tax would not affect 97% of small businesses, although the nonprofit tax foundation says the claim is misleading.

Gilmartin said if a large corporation was involved, the first thing they would likely be to close the Spokane office to consolidate operations.

“Then they looked at our Idaho employees and asked if they had such good pay and benefits,” he said.

Gilmartin also said he was concerned about possible changes to the qualified company income allowance.

“We take the cash flow that we don’t have to give to the government and we spend it,” he said. “We spend it on buildings and equipment. We added more gear last year, more gear this year, and we plan to add more next year. As long as this withdrawal exists, we can continue at this particular pace. There are more jobs, there are more taxes for the community. It’s a win-win situation all round. “