The tax is expected to primarily fall on small businesses and the self-employed, who are the main purchasers of fully-insured premiums.
According to an earlier study, not repealing the tax could cost also cost between 125,000 and 249,000 jobs by 2021 and raise the cost of employer-sponsored insurance by 2-3 percent, a cumulative cost of nearly $5,000 per family.
“The [p]resident’s health care law is full of hidden tax increases. Beginning in 2014, millions of American small businesses will be subjected to a new health insurance tax (HIT) coming at a cost over $100 billion. This tax will close many small businesses and kill jobs once implemented,” Louisiana Republican Rep. Charles W. Boustany, a co-sponsor of the measure, said in a statement.
The bill, titled “The Jobs and Premium Protection Act,” is also sponsored by Democratic Utah Rep. Jim Matheson.
“We commend Representatives Boustany and Matheson for rising above the political gridlock and showing bipartisan support for small businesses and the Americans they employ,” said Jim Anderson, vice president of government affairs of the National Association of Wholesaler-Distributors. “We look forward to working together with all members of Congress to ensure this important bipartisan legislation is passed.”
The Congressional Budget Office has concluded this tax “would be largely passed through to consumers [small and family-owned businesses] in the form of higher premiums for private coverage.”
“Increasing the cost of health insurance plans for small business owners and the self-employed make offering affordable coverage, or any coverage at all, to employees more difficult,” the Stop the HIT coalition said in a statment.
“We are encouraged by the introduction of this vital bipartisan legislation to preserve the health and financial security of small businesses across the country,” said National Federation for Independent Business President and CEO Dan Danner in a statement. “We hope members of Congress will join together to fix this unintended consequence of the [p]resident’s health care law and prevent yet another hit to small businesses and the Americans and families they employ.”
Similar legislation was introduced in the previous session of Congress, but failed to gain traction before the bill expired.
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