Pressure Spurs Senate Repeal Of Health Care Tax Measure
imageThe U.S. Senate yesterday voted to repeal a tax reporting requirement included in last year’s health care overhaul law. Sponsored by Republican Senator Mike Johanns, the legislation—passed in the Senate with a vote of 87 to 12. It repeals a requirement mandating the filing, by businesses and landlords, of a Form 1099 document with the Internal Revenue Service for purchases of goods and services exceeding $600 annually. In passing the legislation, the Senate was reacting to pressure from business groups that have repeatedly voiced concern about the volume of paperwork they would be compelled to handle had the requirement remained a component of the law. The tax filing requirement did not relate directly to health care, but was intended to help fund the health care law. The legislation was passed earlier by the House of Representatives and now goes to Obama, who is expected to sign it into law. Congress approved the legislation despite some concern among Democrats about the manner in which the $22 billion cost to the U.S. Treasury of repealing the tax-reporting provision is covered. The bill adjusts the health insurance tax subsidies to be provided to middle-income individuals under the health care law. It would mandate that anyone who receives excessive tax subsidies for health insurance pay back a greater share than currently required under the law. Democratic and Republican lawmakers alike concur that eliminating the tax reporting requirement was the proper course of action. However, some Democrats contended that the payback provision for excessive subsidies would dissuade individuals and small businesses from complying with the law's requirement that they obtain health insurance.