Salon Today - January 2009 - (Page 14)

[RECEPTION] Predicting the New Washington’s Impact On Salon Business R Regardless of how you cast your ballot last November, the Obama administration and a Democratic Congress will impact the professional salon industry and your business. Sam Leyvas, director of government affairs, Professional Beauty Association, analyzes the issues and predicts the impact of this month’s incoming government: Sam Leyvas, PBA NEGATIVE IMPACTS “Card Check” Law (Employee Free Choice Act) This bill died in the Senate in 2008, but will mostly likely resurface in early 2009. Card Check would make it cost effective for unions to go after Main Street businesses, such as beauty/nail salons and spas, which have never experienced unionization before. The law would do away with the secret ballot process currently used for unionization in the workplace and replace it with a Card Check system. Once a union persuades more than half of the workers to sign membership cards, the union would automatically be certiﬁed. Without the secret ballot process, employees would be exposed to intimidation and bullying tactics from union organizers. “With Democrats traditionally supporting organized labor and unions aiming to fold more employees into membership, this law could completely change the economics of union organizing,” says Leyvas. Elimination of LIFO Accounting Method tors would be affected, and hundreds of thousands of American businesses would incur massive tax increases. “The restricted use or outright repeal of LIFO would have far-reaching and potentially damaging effects on companies, principally manufacturers and distributors, who rely on effective inventory management to remain proﬁtable,” says Leyvas. POSITIVE IMPACTS FICA Tax Credit for Salons and Spas With a ﬂurry of tax legislation activity predicted in Congress, there will be new opportunities to advocate for a FICA tax credit, which would give salon and spa owners a dollar-fordollar tax credit on FICA taxes paid on employee’s tip-income. “The legislation would signiﬁcantly help small and large salons and spas to lower tax liability and allow further investment in business,” says Leyvas. Credit Card “Interchange Fees” Although the proposed repeal of the “Last-In, First-Out” inventory accounting system was recently defeated in Congress, with a new Congress controlled by one party and the increased pressure to close the federal “tax gap,” it is likely to resurface. Manufacturers and distribu- Interchange fees are the hidden costs of processing credit and debit card transactions. The new Democratic Congress will most likely resurrect the “Credit Card Fair Fee Act”— federal legislation that would require credit card companies with “substantial market power” to negotiate with merchants and retailers on terms of fees paid when processing card transactions. 14 | January 2009 www.salontoday.com http://www.salontoday.com/touchsuite http://www.salontoday.com

Table of Contents Feed for the Digital Edition of Salon Today - January 2009

Salon Today - January 2009 Contents Editor's Note Reception The 12th Annual SALON�TODAY 200: Portaits of Success Salon Today 200: $250,00 to $499,999 Salon Today 200: $500,000 to $999,999 Salon Today 200: $1 million to $1,999,999 Salon Today 200: $2 million plus Trademarks Products A Time for Change

Salon Today - January 2009

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.