Local businesses, workers prepare for tax hikes

6:37 PM, Aug 21, 2012   |    comments
  • Share
  • Print
  • - A A A +

CLEVELAND -- Northeast Ohio businesses and their employees are preparing for big payroll tax increases.

Unless the current employee payroll tax of 4.2 percent is extended, the new rate will revert back to 6.2 percent, where it was before payroll taxes were cut at the end of 2010.

That means every employee will take home 2 percent less in his or her paycheck.

"We actually think it's dreadful news and not very good news for our employees," says Bernie Doyle, owner of FastSigns, a small printing business with eight employees in Cleveland.

"We have hourly employees and it's going to reduce their take-home pay," Doyle continued. "The notion that you're going to increase taxes 2 percent on working class people is ridiculous, because at the end of the day it doesn't solve the real problem. Social security is broken."

His wife Kay, who has run the business with her husband since January, 2000, says the end of the two year payroll tax holiday will hit their employees hard.

"While it was meant to be a temporary measure in 2010, I don't think anyone here in Northeast Ohio would say we are out of the woods yet," Kay Doyle told WKYC. "For someone who takes home about $1,400 every two weeks, right now they're paying $54 in tax. Soon they'll be paying $90."

Fast Signs employee Dan Smith says the two percent would be better staying in his pocket.

"I'm a good consumer," he offered enthusiastically. "I spend money locally. I buy things and try to drive the local economy by shopping local and things like that."

Bernie Doyle says he and many others will be watching how candidates for Congress and the White House approach the idea of extending tax cuts.

"I became an Ameican citizen two weeks ago," he announced proudly. "You are looking at the new decider and you can be sure I will be voting in November."

WKYC-TV

Most Watched Videos