Emphasis added.
A lot of the "income" cited by ATR is taken in by a fraction of entities the law considers small businesses; the Tax Policy Center says that Obama's plan will touch fewer than 700,000
taxpayers -- though it's not clear how many of them are full-time small business owners. If you have business income of less than $250,000 your tax rate won't change.
ATR's claim involves the share of small business income rather than the share of small businesses. Most of what people typically think of when they hear small businesses -- car dealerships, farms, etc -- do take in incomes of more than $250,000. But most people who input their earnings into the Obama tax calculator won't fall into the category.
Ryan Ellis, ATR's economist, e-mails his response to my question:
This is the fundamental difference between Obama and us:
Obama says that the overwhelming number of small businesses in America won't face a tax hike. That's true.
We say that the overwhelming amount of small business profits in America will face a tax hike. That's also true.
How is this possible?
If you have a journalism school intern for a semester and he gets $3000 as a stipend, he counts as a small business owner. He's one of the small businesses that won't face a tax hike under Obama. This is cheating, since Obama is moving the goalpost.
However, if you're concerned about a "tax hike on the small business sector," aren't you really talking about the tax rate paid on the bulk of small business profits? We think so. We're not so much concerned about your intern's tax rate as the tax rate of the guy who owns a chain of dry cleaners in Alexandria.
The number of firms is not what matters. It's the fact that Obama is raising taxes on two-thirds of small business profits.
| 
