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CompTIA Says Fiscal Cliff Fallout to Hurt Small Technology Businesses

New White Paper Details Impact of Tax Provisions, Sequestration

WASHINGTON, Nov. 13, 2012 /PRNewswire-USNewswire/ — Small and medium information technology (IT) businesses will experience major trauma if Congress fails to address the “fiscal cliff,” finds a new white paper released today by CompTIA [1], the non-profit association for the IT industry.

The white paper [2], which focuses on the $955 billion domestic IT sector, warns that mandatory spending cuts will harm small and medium IT businesses, as well as the economy as a whole. The paper also points out specific business expensing and tax credit provisions that will harm small IT firms, as well as details how cuts in government programs will impact the sector.

“As Congress returns to wrap up unfinished business, I urge them to consider the impact of tax and federal policies on the domestic IT sector, which employs more than two million workers and contributes $110 billion to workers’ payrolls,” said Todd Thibodeaux, president and chief executive officer, CompTIA.

“An approach that balances revenue increases with spending cuts while prioritizing policies and programs that spur innovation and entrepreneurship can right the ship and sets us on a steady economic course.”

A recent CompTIA survey of IT and business executives found that approximately two-thirds (65 percent) support a degree of balance in addressing the fiscal cliff. Twenty-six percent feel Congress should implement spending cuts and revenue increases equally, while 23 percent favor slightly greater spending cuts and 16 percent support slightly greater revenue increases.

The white paper, entitled “Impact of the Fiscal Cliff on SMB IT Companies,” highlights a number of tax policies that have lapsed or are set to expire at the end of the year and threaten to hit technology businesses. Those provisions include:

Moreover, sequestration, or across-the-board spending cuts set to go into effect in 2013, will impact small IT businesses significantly.

“As President Obama works to strengthen the economy, it is critical that he supports the efforts of small businesses to grow and innovate. It is equally important that his administration act to help displaced and unemployed workers who, with training and assistance, can find meaningful careers in IT, and contribute to U.S. innovation and global leadership,” added Thibodeaux.

About CompTIA
CompTIA is the voice of the world’s information technology (IT) industry. Its members are the companies at the forefront of innovation; and the professionals responsible for maximizing the benefits organizations receive from their investments in technology. CompTIA is dedicated to advancing industry growth through its educational programs, market research, networking events, professional certifications, and public policy advocacy. Visit http://www.comptia.org/home.aspx [1] or follow CompTIA at http://www.facebook.com/CompTIA [3] and twitter.com/comptia [4].

SOURCE CompTIA