32.  Impact to Industry

Comment: One respondent commented that the proposed payment withholding regime will threaten the solvency of contractors and preclude many companies from contracting with the Government. The respondent indicated that the payment withholding regime will be particularly harsh on small businesses.

Response: In the long run, both the contractor's and the Government's administrative cost should be reduced with the reliance on efficient contractor business systems. The rule has been revised to exclude small businesses in accordance with section 893 of the FY2011 NDAA.