Press Release

Stop The HIT Coalition Applauds Senators Barrasso and Hatch for Introducing Legislation to Repeal the Small Business Health Insurance Tax

WASHINGTON, D.C. (January 16, 2015) – The Stop The HIT Coalition, a broad-based group representing the nation’s small business owners, their employees and the self-employed, today commended the introduction of “Jobs and Premium Protection Act of 2015” (S.183) from Senators John Barrasso (R-Wyo.) and Orrin Hatch (R-Utah) to repeal the Health Insurance Tax (HIT) included in the Patient Protection and Affordable Care Act (PPACA).

“Senators Barrasso and Hatch have shown a long-standing commitment to small business by recognizing how this tax is jeopardizing the affordability of health insurance for employers, employees and their families. This bill would provide much needed relief for the hard working Americans who are contributing to our economy, community by community,” said Amanda Austin, vice president of public policy at the National Federation of Independent Business. “With 20 Senators already agreeing to cosponsor, we encourage their legislative colleagues to follow their lead to relieve Main Street of the burden of yet another empty tax.”

The HIT is an often overlooked small business tax in the President’s health care law, the PPACA, which will impose $145 billion in new taxes on the small business community, their employees and the self-employed over the next decade. This year alone the tax will collect $10 billion. Originally referred to as a fee on insurers, the HIT is actually a tax being passed onto consumers in the fully insured marketplace in the form of higher premiums. The HIT does not sunset and is expected to cost each family approximately $5,000 in higher premiums over the decade according to an analysis by former Congressional Budget Office (CBO) Director Douglas Holtz-Eakin.

According to a study by the National Federation of Independent Business Research Foundation, the HIT would reduce private sector employment by between 152,000 and 286,000 in 2023. Roughly 57 percent of these job losses will fall on small businesses. The survey also showed that the added tax would reduce U.S. real output (sales) in 2023 by between $20 billion to $33 billion.