Obama pushes tax changes to help small businesses but doesn’t budge on immigration

President Obama challenged lawmakers in his annual address to overhaul the tax system and improve infrastructure in ways that will bolster new and small businesses, but he didn’t budge on his bid for comprehensive immigration reform, an area in which many entrepreneurs hoped he would warm to smaller, targeted proposals.

In his fifth State of the Union, Obama renewed his pledge to build a stronger middle class and accelerate the economic recovery, and he urged legislators on both sides of the aisle to “forge a reasonable compromise” on contentious matters like reducing the deficit and reforming the tax code. On the latter issue, he acknowledged that the system has become far too complex for small business owners.

“The American people deserve a tax code that helps small businesses spend less time filling out complicated forms and more time expanding and hiring,” he said in the first of two specific references to small businesses, a group that came up nearly two dozen times in each of the domestic policy debates during the fall campaign.

Obama also proposed spending more federal money on clean energy, manufacturing technologies, better education and new roads and bridges — investments he said will “help entrepreneurs and small business owners expand and create new jobs.”

“But none of it will matter unless we also equip our citizens with the skills and training to fill those jobs,” he added, touching on a sore subject for a growing number of business owners who say they cannot find enough talented workers to fill their firms’ openings.

However, education reform wasn’t the remedy some of them had in mind — many were hoping the president would throw his support behind targeted immigration reform; namely, proposals to allow more highly educated, foreign-born workers into the country.

“Issues concerning immigration, specifically special visa programs for entrepreneurs and high-tech workers, were not addressed in any significant manner,” Rohit Arora, chief executive and co-founder of Biz2Credit and a small business finance expert, said of the speech, adding that he thought the president “didn’t go far enough to enforce the message that job growth and small business growth is a big priority for the country.”

Instead, though he acknowledged the importance of attracting skilled entrepreneurs and engineers, Obama reaffirmed his push for comprehensive immigration reform and gave no indication that he would support legislation that did not include stronger border security measures and a path to citizenship for undocumented workers. “Send me a comprehensive immigration reform bill,” he told Congress, “and I will sign it right away.”

A multifaceted deal of that nature could be a long time coming, though, and entrepreneurs and investors have been upping the pressure on policymakers to pursue a piecemeal solution. On two occasions last week, start-up founders from around the country traveled to Washington, urging members of Congress and the administration to separate out and address the demand for more highly educated immigrants before they try to hash out a compromise on broader immigration questions.