Health Bill Finances Hit Small Business

Aaron Flint posted on August 30, 2010 08:43 :: 1124 Views

Well, at least one liberal blogger thinks the fact that Sen. Max Baucus (D-MT) hasn’t read the health care bill is not newsworthy.  The Billings Outpost’s David Crisp had this to say:   

I agree that Baucus so rarely gives straightforward answers to simple questions that it’s probably newsworthy when he does. But not reading every jot and tittle of a major piece of legislation is a very sensible thing for a congressman to do.

One advantage of having so many lobbyists in Washington is that you have people both for and against any major bill poring over the language looking for loopholes and inconsistencies, of which there are likely to be many.

So if Senator Baucus’ response to the “did you actually read the bill” question was: “We hire experts.”  I guess Crisp’s response is: “We have lobbyists.”

Well, Crisp may not have thought the Senator’s remarks were newsworthy, but the Dallas Morning News certainly did.

Meanwhile, one small business owner commented on the post, complaining about one of the provisions used to “pay for” the federal health care bill and expanded subsidies.  That provision deals with small businesses filing 1099 forms. 

Which actually brings us to another important point.  We’ve already heard how one of the first programs out of the gate with the new health care bill, the high risk coverage plan, is already scheduled to run out of money.  Well, now it looks that Congress may be on track to get rid of this new 1099 mandate as well.

Here’s what the Washington Post reported over the weekend, adding that a move is underway in Congress to repeal the provision:

The provision, which takes effect next year, will require businesses to file 1099 tax forms reporting any purchases they make of goods or services above $600 from any individual or business, including corporations. Currently, businesses only need to file 1099s when they buy services – and only when the vendor is an unincorporated person or business.

The move – designed to clamp down on tax evasion- was projected to raise $17.1 billion over 10 years toward the cost of the health-care law.

The 1099 measure attracted little attention during the months-long health-care debate. As far back as 2007, President George W. Bush’s administration and Senate Finance Committee Chairman Max Baucus (D-Mont.) discussed proposals for closing the estimated $345 billion annual federal tax gap – the difference between taxes owed and taxes paid. So in the spring of 2009, as Baucus and others were looking for ways to offset the cost of the health-care bill, the 1099 provision offered a ready answer.

Of course, small businesses would argue that repealing this provision is necessary.  Nonetheless, this debate is one more reminder that all that talk about the federal health care bill being “deficit neutral” was just that- talk.        

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