Daily Tax Update - October 30, 2009

HOUSE MINORITY LEADER: HEALTH CARE REFORM BILL “A MONSTROSITY”:  Yesterday, the 1990-page House health care reform bill was introduced by Democrats which House Republicans called “1990 pages of bureaucracy.” House Minority Leader John Boehner said yesterday, “Speaker Pelosi’s 1,990-page bill is going to raise the cost of health insurance for most American families. It's going to raise the cost of health insurance, new mandates, new taxes. I think it's just -- it's a monstrosity. And it's exactly what the American people have been telling the Congress for months that they don't want. They don't want government control of their health care, and that's exactly what this is.”

• “According to CBO and JCT’s assessment, enacting ‘The Affordable Health Care for America Act’ (H.R. 3962) would result in a net reduction in federal budget deficits of $104 billion over the 2010–2019 period. . . . The estimate includes a projected net cost of $894 billion over 10 years for the proposed expansions in insurance coverage.”

• The House is expected to take up its bill next week. The bill must secure 218 votes in the House to pass. Finance Chairman Max Baucus and Senate Democratic leaders are working to find the 60 votes required to pass the bill.

• The House and Senate pay for their health care reform bills in very different ways. The Senate uses a 40-percent excise tax on high-cost health insurance plans while the House relies mainly on a tax on high-income earners and other revenue offsets. The other offsets in the House bill include an excise tax on medical devices sold for use in the United States, mandatory information reporting on payments made in the course of a trade or business to a corporation, a nine-year delay until December 31, 2019 in the application of worldwide allocation of interest, a limitation on treaty benefits for certain deductible payments, codification of the economic substance doctrine, and the addition of a “more likely than not” standard for tax penalties on underpayments by certain large or publicly traded persons.

• Ranking Ways and Means Committee member Dave Camp said, “The bill contains $560 billion in new taxes and will cost millions of Americans their jobs. Despite the rhetoric from the other side, the taxes in this bill will fall hardest on working Americans.”

• A summary of the revenue provisions can be accessed here. 

TAX BILLS INTRODUCED OCTOBER 29th:

H.R.3971: To amend the Internal Revenue Code of 1986 to expand the permissible use of health savings accounts to include health insurance payments and to increase the dollar limitation for contributions to health savings accounts, and for other purposes.
Sponsor: Rep Flake, Jeff [AZ-6] (introduced 10/29/2009) Cosponsors (None)

S.2051: A bill to amend the Internal Revenue Code of 1986 to allow refunds of Federal motor fuel excise taxes on fuels used in mobile mammography vehicles.
Sponsor: Sen Vitter, David [LA] (introduced 10/29/2009) Cosponsors (1)

S.2081: A bill to amend the Internal Revenue Code of 1986 to accelerate locomotive fuel savings nationwide and provide incentives for owners of high polluting locomotives to replace such locomotives with newly-built or newly-remanufactured fuel efficient and less polluting locomotives.
Sponsor: Sen Specter, Arlen [PA] (introduced 10/29/2009) Cosponsors (1)

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