In the video clip, Joe says that he is "buying" the business. When you buy a business, normally you take out a loan and pay it back over time. Sometimes the prior owner will hold the loan.
But the tax rules say that principle paid on the loan is not deductable. Therefore, those principle payments are TAXABLE even though you never see the money!
If Joe has to pay half a million dollars for this business (very possible), and he pays it to the prior owner over 5 years (typical deal), then on average each year he pays back $100,000 in principle (less in year 1, more in year 5). He only gets a fraction of that offset by depreciation in a business like his. Most of that $100,000 counts as his income, he owes taxes on it and if Obama gets his way at a much higher tax rate.
The effect? It actually makes just about every small business worth less. Buyers will take into account the tax ramifications of buying a business. If general taxes go up, the business is worth less. PLUS: Obama will raise the cap gains rate, making all small businesses AGAIN worth less money!
The bottom line: in several different ways, Obama's tax policies make it less profitable to start, buy, or own a small business. Small businesses create 2/3 of all new jobs.
You do the math.
That's true for a residential loan, but not for a business loan.
The principal and interest you pay on your loan are business expenses, and you can deduct them from your taxes as such. In order to take advantage of a tax deduction, you must report the total amount of the loan, and the assets and expenditures financed must be necessary to operating the business.