DETROIT – Michigan small business owners and advocates gathered for a roundtable event February 28 to discuss the threat and implications of the looming Health Insurance Tax (HIT). The HIT will take effect in 2014 and directly impact each of Michigan’s 820,244 small businesses. Small business owners believe the tax will severely reduce their ability to expand, create new jobs and contribute to the state’s economy.
During the event, small business owners from the Detroit area had the chance to meet with fellow local owners and employees to examine the possible effects the HIT will have on the small business community as well as the significance of repealing the costly tax.
“The city of Detroit and the entire state of Michigan truly emphasize the qualities of hard-work and determination, and our small businesses are no exception. In Michigan, small businesses make up 98.3 percent of the state’s total employers and provide products, services and revenue unparalleled by any other segment. Michigan cannot afford a tax that is so threatening to one of our greatest assets, the HIT must be stopped,” said Tony Stovall, President of the Detroit Black Chamber of Commerce.
The HIT, part of the Patient Protection and Affordable Care Act, was originally intended to target large insurance companies. However, some believe that it will directly fall upon small business owners and their employees and the self-employed, totaling $87 billion within the first ten years, and $208 billion in the next decade.
“Michigan officials must stand up for our small businesses and provide support for their success by repealing this unnecessary HIT that will stifle small business growth and prevent future job creation,” said Damon Tooles, President of Tooles Contracting Group.
The event was hosted by members of the Stop The HIT Coalition, which represents small business owners, their employees and the self-employed who support a repeal of the HIT and seek to educate policymakers about the impact of the pending tax.
According to the National Federation of Independent Business Research Foundation, the HIT will have devastating effects on the nation. It will:
- Reduce private sector employment nationally by 250,000 jobs by 2021
- Result in $30 billion in lost sales through 2021, with 59 percent of those losses falling on small business
- Nationally impact the bottom lines of 2 million small business, 12 million employees and self-employed individuals and 26 million employees who are covered by their employer
- Reduce the take-home pay by $500 a year or $5,000 in just the first decade for an employee with a family plan
Last May, small business groups from across the country announced the formation of the “Stop The HIT” Coalition. Since then, legislation to repeal the HIT has been introduced in both the Senate and House. Senators John Barrasso, Orrin Hatch and Olympia Snowe introduced S. 1880, “The Jobs and Premium Protection Act and companion legislation in the House, H.R. 1370 currently has over 100 cosponsors. The Coalition has grown to more than 35 national organizations, representing millions of employees from across the country. The Stop The HIT Coalition has aggressively generated grassroots support for repeal of the HIT by educating policymakers and activating its members who will be directly impacted by the pending tax.