The NYT reports on growing bipartisan support for repealing one of the tax provisions contained in the health care reform legislation.
To improve compliance, the law requires businesses to file a 1099 tax form identifying anyone to whom they pay $600 or more for goods or merchandise in a year. Businesses will also have to send copies of the form to their vendors, suppliers and contractors.
Businesses denounce the requirement, and even the national taxpayer advocate at the Internal Revenue Service, Nina E. Olson, said the reporting burden might “turn out to be disproportionate as compared with any resulting improvement in tax compliance.” . . .
Under the law, businesses will be required to report purchases of items like office equipment, food and bottled water, gasoline, lumber and plumbing supplies if payments to any vendor in the course of a year total at least $600. They will, in many cases, also have to report payments for things like travel and telephone and Internet service.
The annual reports must include the vendor’s address and taxpayer identification number.
The provision is supposed to generate a substantial revenue — an estimated $17 billion over ten years — which could make repeal difficult, but it is interesting how many Democrats, including some who voted for the health care bill, now want repeal of this measure. The NYT also reports that the White House fears repealing this provision could make it easier to go after other parts of the law.