WASHINGTON, D.C. (May 6, 2014) – The Stop the HIT Coalition, a broad-based group representing the nation’s small business owners, their employees and the self-employed, responded to new data from the National Federation of Independent Business (NFIB) Research Foundation’s BSIM model suggesting private sector employment will be reduced by 152,000 to 286,000 jobs by 2023. Approximately 57 percent of those losses will fall on small businesses, all stemming from the small business health insurance tax (HIT) and the two to three percent rise in cost of employer-sponsored insurance.
“Once again, we are faced with data that paints a picture of a stunted future for small businesses in America. The HIT represents a cumulative cost of nearly $5,000 per family over the next decade, a burden that will resonant across the country and the economy with 34 million Americans affected. The significant loss in private sector employment is crippling for small business and will only serve to slow our economy’s growth even further.”
In addition to the loss in private sector employment, real GDP is forecast to be $20 billion to $33 billion lower in 2023 than it would be without the HIT.
The HIT is an often-overlooked aspect of the Patient Protection and Affordable Care Act (PPACA) that taxes health insurance policies purchased on the fully-insured market – the marketplace where 88 percent of small businesses and individuals buy insurance. Labor unions and large corporations are largely exempt from the tax.
Legislation to repeal the HIT has been introduced in both houses of Congress. S. 603 and H.R. 763 combined have more than 250 bipartisan cosponsors, and legislation to provide relief from the HIT for two years (HR 3367) has 48 bipartisan cosponsors.