Even though Senate Democrats defeated the Republicans’ attempt to repeal President Barack Obama’s healthcare law Wednesday, senators agreed in a bipartisan vote to reverse a part of the law that has been the target of withering criticism from business owners. The Democratic-controlled Senate voted 51-47 against the overall repeal in a procedural tally.
However, immediately before that action, senators from both parties voted 81-17 to remove the law’s provision boosting tax-reporting rules for small businesses. That portion required them to file a tax form with the Internal Revenue Service for any vendor with whom they have at least $600 in transactions.
The tax requirement is intended to prevent vendors from underreporting income and underpaying taxes. It is estimated to generate $1.9 billion in taxes a year, which would be used to help pay the cost of the health overhaul.
During Obama’s State of the Union speech last week, the president had cited that provision as one portion Democrats might be willing to sacrifice. Several times last year, the Senate voted several times on rolling back the requirement, but partisan bickering over how to pay for it plundered those attempts.
The provision was intended to raise about $17 billion in previously uncollected taxes. A bipartisan array of business groups argued that the paperwork it required would be too daunting.
Proposing the amendment to repeal that section came from Sen. Debbie Stabenow, D-Mich., who said, “This amendment is a common-sense solution for business owners who need to be focused on creating jobs, not filling out paperwork for the IRS.”
Last year, Democrats thwarted a similar that Republican Sen. Mike Johanns of Nebraska had proposed. Johanns had proposed the amendment again this week, but senators opted for Stabenow.
No hard feelings from Johanns, who told Politico: “The net effect is that, the way I look at it, my desire is to get this repealed. It’s a victory for the business community, churches and charities and state and local governments. So I’m not creating a fuss. I’d be happy to vote for the amendment whether it has my name on it or hers.”
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