President Clinton's $241 billion tax hike in 1993 raised taxes for many individuals and small businesses by 46 percent. Businesses with fewer than 500 employees created 84 percent of new jobs last year; which means that increasing their tax burden limits job growth.

• Most small businesses are organized as Subchapter S corporations, partnerships or sole proprietorships, and thus 80 percent of small businesses pay taxes as individuals.

• The 1993 act raised the top income tax rate from 31 percent to 36 percent and added a 10 percent tax surcharge on individuals and small businesses with incomes over $250,000.

• It also eliminated the $130,000 wage cap on the federal health insurance payroll tax, and extended expiring limitations on both personal exemptions and itemized deductions.

• Thus the marginal income tax rate of many businesses increased by 14.5 percentage points.

Data from tax returns for 1993 show that about 66.8 percent of small business income was subject to the tax increases. More than two-thirds of taxpayers with adjusted gross incomes of more than $200,000 reported some income from business activity.

Source: Paul G. Merski, "The President's Forgotten Middle Class," Economic Policy Update, March 1996, Joint Economic Committee of Congress, Washington, DC.