Congress votes to repeal small part of health lawCongress sent the White House its first rollback of last year’s health care law Tuesday, a bipartisan repeal of a burdensome tax reporting requirement that’s widely unpopular with businesses. Even President Barack Obama is eager to see it gone.
WASHINGTON — Congress sent the White House its first rollback of last year’s health care law Tuesday, a bipartisan repeal of a burdensome tax reporting requirement that’s widely unpopular with businesses. Even President Barack Obama is eager to see it gone.
The Senate voted 87 to 12 to repeal the filing requirement, which would have forced millions of businesses to file tax forms for every vendor selling them more than $600 in goods each year, starting in 2012.
North Dakota’s congressional delegation issued statements Tuesday praising the repeal, which they said will allow small businesses to focus on growing the economy rather than deal with increased paperwork.
“We must not do anything that hurts our fragile economic recovery and that means removing obstacles that keep small businesses from creating jobs,” Sen. Kent Conrad said.
Sen. John Hoeven said America’s 17 million small businesses have created most of the country’s new jobs in the past 15 years, “and passage of this measure removes a major expense and bureaucratic burden that will enable them to continue to do that.”
Rep. Rick Berg, who co-sponsored and voted for the repeal bill in the House, said the 1099 filling requirement puts a “significant burden” on small businesses.
Minnesota’s Sen. Amy Klobuchar also voted for the repeal bill Tuesday, and said it’s the wrong time to require businesses to fill out more forms.
“At a time when our top priority has to be promoting economic growth and job creation, I believe we need to cut through the red tape and eliminate this excessive regulation,” she said in a written statement.
Barry Wilfahrt, president of the Chamber of Grand Forks and East Grand Forks, said the repeal is a “huge deal” for the business community.
“That would have put an enormous reporting requirement on the backs of small businesses,” he said.
Even smaller businesses would see a “very substantial” increase in paperwork if the provision went into effect, Wilfahrt said.
“We’re very pleased to see that mandate fail,” he said.
Health care law repeal?
The new filing requirement is unrelated to health care. However, it would have been used to pay for part of the new health law and was projected to raise almost $25 billion over the next decade by ensuring vendors pay their taxes.
Republicans hope this is the first of many such bills, resulting in the entire health care law being scrapped. Democrats say the bill is part of an inevitable tinkering that will be needed to improve the health measure.
“I just saw this as something that never should have been in the health care law,” said Sen. Mike Johanns, R-Neb., who sponsored the repeal bill in the Senate.
White House spokesman Jay Carney said, “We are pleased Congress has acted to correct a flaw that placed an unnecessary bookkeeping burden on small businesses.”
Businesses already must file Form 1099s with the IRS when they purchase more than $600 in services from a vendor in a year. The new provision would have extended the requirement to the purchase of goods, starting in 2012.
The requirement would hit about 38 million businesses, charities and tax-exempt organizations, many of them small businesses already swamped by government paperwork, according to a report by the National Taxpayer Advocate, an independent watchdog within the IRS.
Democrats passed the health care law last year with no Republican support, when they had majorities in both the House and Senate. Republicans took control of the House in January, following congressional elections in November.
The Associated Press contributed to this report. Reach Johnson at (701) 780-1105; (800) 477-6572, ext. 105; or send e-mail to firstname.lastname@example.org.