Three Democratic senators push for 1099 reform
Three Democratic senators have penned a letter to House Speaker John Boehner (R-Ohio) pushing for a vote on repealing a provision of the national health care overhaul regarding tax-reporting requirements for businesses.
Democratic Sens. Ben Nelson (Neb.), Amy Klobuchar (Minn.) and Maria Cantwell (Wash.) sent the letter to Boehner Thursday morning.
The unpopular 1099 tax provision, which requires businesses to report to the Internal Revenue Service all purchases of $600 or more, has been panned by members of both parties. Late last year, efforts by Sens. Mike Johanns (R-Neb.) and Max Baucus (D-Mont.) to repeal the provision came up short, and a Democratic-led effort to include 1099 repeal in the tax-cut package was one of several proposed add-ons nixed by Republicans during the lame-duck session.
A repeal measure, H.R. 4, has already been introduced but a vote has not been scheduled. House Republican aides had previously said that they expected it would be taken up shortly after a vote on the full repeal measure, which passed the House Wednesday.
Boehner spokesman Michael Steel said Republican leaders support the 1099 repeal but emphasized that their top priority is repeal of the entire health care law.
"While we support eliminating the 1099 requirement, it is far from the only job-destroying provision in Washington Democrats' law," Steel said. "Now that the House has passed a law to repeal it, the best course would be for the Senate to do the same, and I hope these senators are pressing Senate Majority Leader Reid to do just that."
The full text of the letter to Boehner is after the jump.
January 20, 2011
Dear Speaker Boehner,
Now that you have moved past repeal of the Affordable Care Act, we encourage you to work on efforts to improve the law moving forward. In this spirit, we urge you to take up and pass H.R. 4, a bill which simply strikes the tax-reporting requirement in the health reform law. We have heard from small business men and women in our states who have voiced concern that this provision is burdensome and unnecessary, and could potentially undermine our nation's economic recovery. Repealing this provision would be an important and practical way to improve the Affordable Care Act. We are confident that the Senate can quickly act on H.R. 4 once the House has passed it.
Section 9006 of the Affordable Care Act (P.L. 111-148) requires all business entities to file a 1099 form with the Internal Revenue Service for each vendor for whom they have cumulative transactions of $600 or more. Small businesses in our states have raised concerns that in order to comply with this new requirement, which takes effect next year, businesses will have to institute new record-keeping methods. The change is particularly onerous for small businesses, our nation's engines of growth, who cannot afford to employ extra lawyers and accountants to comply with the new rules. The provision may also have the unintended consequence of distorting behavior in the marketplace, as large businesses will have an incentive to minimize their reporting requirements by consolidating purchases with large vendors, harming small, regional vendors.
This past November, voters sent both parties a clear message: focus on job creation. As President Obama has recently noted, our economy will recover more quickly and create more jobs if we can reduce regulations on business. Repealing this provision would be a great first step as we work together to grow the economy.
Senator Ben Nelson Senator Maria Cantwell Senator Amy Klobuchar
| January 20, 2011; 12:13 PM ET
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