The 3.4 million small businesses in California that employ more than half the state’s workforce could be facing a health insurance tax per the Patient Protection and Affordable Care Act. On Tuesday Congressman Jeff Denham left Washington to make a local appearance and address small business owners’ concerns regarding the tax at the Modesto Chamber of Commerce, an event hosted by the Stop the HIT coalition.
The Stop the HIT coalition is a broad based group of national small business owners, employees, as well as self-employed individuals, looking to repeal the health insurance tax provision of the Patient Protection and Affordable Care Act.
“The health insurance tax, or HIT, represents a real threat to California small businesses,” said Denham, a co-sponsor of the bipartisan Small Business and Family Relief Act which proposes to delay the health insurance act for two years. “Small businesses are essential for a strong economy... At the very least, small businesses need time and space to prepare for the HIT.”
“The uncertainty surrounding the health insurance tax makes it virtually impossible to prepare for these new added health care costs,” added John Duarte, president of Duarte Nursery in Hughson.
Under the law, the health insurance tax is slated to be imposed on the “fully insured market” where 88 percent of small business owners purchase their health coverage.
The tax will raise the cost of health insurance premiums for families by approximately $5,000 over the next decade, according to an analysis by Douglas Holtz-Eakin, former Congressional Budget Office director and president of the policy institute American Action Forum. The National Federation of Independent Business Research Foundation’s analysis also found that the health insurance tax could jeopardize up to 23,000 jobs in California by 2023, as well as reduce the gross domestic product by almost $4 billion.
Denham is also a co-sponsor of the Jobs and Premium Protection Act which would repeal the health insurance tax.
"We must do everything we can to ensure that Washington is not adding new burdens that will only stifle growth and threaten jobs,” said Denham.