Congress, “Suspend This Tax Again”

Time is of the essence for Congress to address the looming 2020 Health Insurance Tax (HIT) before rate filing deadlines in early June. Absent immediate action to delay the HIT, small businesses will be met with a steep increase in their premiums by as much as $500 on average annually. This added cost significantly reduces their ability to grow their business while maintaining competitive benefits for employees.

The small business community has repeatedly stressed that rising health care costs are their No. 1 concern in managing their business. For small business owners and hardworking families already struggling to make ends meet, the return of the HIT in 2020 and its added cost is simply crushing.

Recently our Coalition spoke with small business owners in New Hampshire to discuss the real-life impact of the HIT on small businesses and the hard decisions they’re forced to make regarding employee benefits. For Sy Mahfuz, a third-generation small business owner, the HIT is making it difficult to provide affordable health coverage. “Taxing health insurance is only making life harder for small business owners across the state. With premiums constantly going up, it’s difficult to afford a quality health plan with coverage that protects employees from high out-of-pocket costs,” noted Sy.

Even for non-profit organizations trying to support individuals and communities in need, the added costs from the HIT pose a direct threat to the families they can help. Erika MacDonald, finance director of the Nashua Soup Kitchen and Shelter explained that the 2020 HIT “would cost us an additional sixty-five hundred dollars a year. To put that in perspective, that’s about one month of food and supplies we would otherwise be able to purchase to serve those in need.”

Within a state that boasts one of the first 2020 primaries, voters are keenly aware that Congress has more work to do. This sentiment is not concentrated solely among New Hampshirites, a recent national poll conducted by Morning Consult found that 2 in 3 adults are very concerned that if Congress does not delay the HIT, it could cost the average American family an additional $500 a year. Tom Boucher, owner of Great New Hampshire Restaurants urges action before impending policy renewals. “By suspending the health insurance tax in the past, Congress has already acknowledged the challenges with this tax. I hope they can come together in a bi-partisan way to suspend this tax again before it impacts our insurance premiums for next year,” relayed Tom.

We applaud our HIT champions in the House and Senate who continually support small businesses and hardworking families by working across the aisle to partner on bipartisan legislative efforts to repeal or delay the HIT during the 116thCongress. Currently, there are four active bipartisan HIT relief efforts within Congress:

  • S. 80 a full repeal bill championed by Senators John Barrasso (R-WY), Cory Gardner (R-CO) and Kyrsten Sinema (D-AZ);
  • S. 172 a 2-year delay bill championed by Senators Cory Gardner (R-CO), John Barrasso (R-WY), Tim Scott (R-SC), Jeanne Shaheen (D-NH), Doug Jones (D-AL) and Kyrsten Sinema (D-AZ); and
  • H.R. 2447 a full repeal bill championed by Representatives Anthony Brindisi (D-NY) and Kenny Marchant (R-TX)
  • H.R. 1398 a 2-year delay bill championed by Representatives Ami Bera (D-CA-7), Josh Gottheimer (D-NJ-5), Jackie Walorski (R-IN-2) and Kenny Marchant (R-TX-24).

Relief from the looming HIT is critical and must be top of mind for Congress, just as it is for the millions of hardworking small business owners and their employees throughout the country who are asking for relief now, once and for all.