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Old 03-13-2013, 01:28 PM   #1 (permalink)
 
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Lightbulb Tax Tax $$ downgraded

Provision / Tan Tax
2010 Estimate, 2010-2019, $billion / Original
2012 Estimate, 2013-2022, $billion / Revised

Impose 10% tax on tanning services
2.7 / $billion / Original
1.5 / $billion / Revised


Impose 10% tax on tanning services
2700 / $million / Original
1500 / $million / Revised


Impose 10% tax on tanning services
270 / $m/year / Original
150 / $m/year / Revised


Even though they have “downgraded” the estimated “revenue” derived from taxing tanning services, the new estimate is still far too high, i.e., $150 million per year for the next 10 years.

The "big news" (which shouldn't surprise anyone) is that the cost (to taxpayers) of Obamacare has already doubled from the original estimate and my guess is that it will ultimately cost at least 10 times more. A financial "train wreck" that will destroy the greatest health care system in the world.

http://www.economicpolicyjournal.com/2013/03/tax-prof-obamacare-tax-increases-are.html

Last edited by Don Smith; 03-13-2013 at 01:32 PM.
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Old 03-13-2013, 03:21 PM   #2 (permalink)
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Re: Tax Tax $$ downgraded

Great info Don. Thank You!
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Old 03-14-2013, 07:49 AM   #3 (permalink)
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Re: Tax Tax $$ downgraded

I think the stem of all our problems was some people claiming the tanning industry was worth $5 Billion. Which I don't think has ever been true. I would like to see the math behind that number.

When you claim you are worth $5 Billion people start coming after you, they want a piece of that action.

Does anyone have the numbers of what the IRS was able to collect for the 1st full year?
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Old 03-14-2013, 10:17 AM   #4 (permalink)
 
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Re: Tax Tax $$ downgraded

http://usatoday30.usatoday.com/money...all/50754314/1
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Old 03-14-2013, 11:46 AM   #5 (permalink)
 
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Re: Tax Tax $$ downgraded

John:

The lobbyists for big pharma (Allergan) and the dermatologists (AAD) were successful in getting Congress to "switch" from taxing the rich patients of rich dermatologists for botox administration. THAT was estimated to bring in in excess of $500M per year and the lobbyists convinced the politicians that (a) the tan tax would bring in almost as much, and, (b) that the "evil" tanning salons "deserved" to be punished.

So Congress ended up being "conned" and traded at least $500M per year (from botox) for approximately $70M (from the Tan Tax); a sum that will continue to decrease as the industry contracts.

Perhaps it is time for us to contact our representative and inform them that they got "conned" and suggest that they should revisit the "botox tax" on the rich patients of rich dermatologists. Given the "climate" for "redistribution of wealth" and "punish the rich" today, that may strike a receptive chord.

There is no sense in trying to get the Tan Tax overturned because the democrats have never seen tax money that they didn't like.

The information below is found in the USAToday article:

Using an April 2010 Indoor Tanning Association estimate, the IRS initially projected the tax would be due quarterly from roughly 25,000 stand-alone tanning salons, plus spas, health clubs and beauty parlors.

But the inspector general report found that actual tax returns filed for the first three quarters through March 31 averaged just above 10,300.

Tanning tax receipts for that nine-month period totaled $54.4 million, the report found. That was below projections by the Congressional Joint Committee on Taxation, which had estimated the tax would raise $50 million in the last three months of fiscal year 2010 and $200 million for the full 2011 fiscal year.
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Old 03-14-2013, 01:21 PM   #6 (permalink)
 
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Re: Tax Tax $$ downgraded

Here is some history about the switch from the Botox Tax to the Tan Tax. This decision (instigated by the dermatologists) cost the taxpayers >$400m per year.

1. Here is the original coverage of the botox tax and the originally proposed bill.

November 18, 2009
Senate bill includes the Botox tax
The bill levies a 5 percent tax on elective cosmetic surgery. The provision raises $5 billion and was needed to make the numbers work, according to a Democratic Senate aide.
The Finance Committee considered the tax but dismissed it, in part because it was a public relations battle that senators were not willing to wage.

Here is the original bill: / Page 2045 of the Affordable Health Care Act

SEC. 9017. EXCISE TAX ON ELECTIVE COSMETIC MEDICAL PROCEDURES.

(a) IN GENERAL.-Subtitle D of the Internal Revenue Code of 1986, as amended by this Act, is amended by adding at the end the following new chapter:

''CHAPTER 49-ELECTIVE COSMETIC MEDICAL PROCEDURES ''Sec. 5000B. Imposition of tax on elective cosmetic medical procedures.

''SEC. 5000B. IMPOSITION OF TAX ON ELECTIVE COSMETIC MEDICAL PROCEDURES.
''(a) IN GENERAL.-There is hereby imposed on any cosmetic surgery and medical procedure a tax equal to 5 percent of the amount paid for such procedure (determined without regard to this section), whether paid by insurance or otherwise.
''(b) COSMETIC SURGERY AND MEDICAL PROCEDURE.-For purposes of this section, the term 'cosmetic surgery and medical procedure' means any cosmetic surgery (as defined in section 213(d)(9)(B)) or other similar procedure which-
''(1) is performed by a licensed medical professional, and
''(2) is not necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or disfiguring disease.
''(c) PAYMENT OF TAX.-
''(1) IN GENERAL.-The tax imposed by this section shall be paid by the individual on whom the procedure is performed.
''(2) COLLECTION.-Every person receiving a payment for procedures on which a tax is imposed under subsection (a) shall collect the amount of the
tax from the individual on whom the procedure is performed and remit such tax quarterly to the Secretary at such time and in such manner as provided
by the Secretary.
''(3) SECONDARY LIABILITY.-Where any tax imposed by subsection (a) is not paid at the time payments for cosmetic surgery and medical procedures are made, then to the extent that such tax is not collected, such tax shall be paid by the person who performs the procedure.''.

(b) CLERICAL AMENDMENT.-The table of chapters for subtitle D of the Internal Revenue Code of 1986, as amended by this Act, is amended by inserting after the item relating to chapter 48 the following new item:
''CHAPTER 49-ELECTIVE COSMETIC MEDICAL PROCEDURES''.

(c) EFFECTIVE DATE.-The amendments made by this section shall apply to procedures performed on or after January 1, 2010.
http://www.politico.com/livepulse/1109/Senate_bill_includes_the_Botox_tax.html

2. Presidential advisor Gene Sperling was the “father” of the Botox Tax.
The idea of taxing cosmetic surgery surfaced over the summer. As Politico then reported, a Senate committee aide said that Treasury Department economic adviser Gene Sperling proposed the excise tax. Senate Finance Chairman Max Baucus (D-Mont.), whose committee worked long and hard on health care reform, dismissed the tax at that time.

Note: Gene Sperling is Director of the National Economic Council and Assistant to the President for Economic Policy. He was in the news recently because of his email telling Bob Woodward that he would “regret” telling the public that President Obama came up with sequester.

http://www.politicsdaily.com/2009/11/21/the-botox-tax-a-troubling-new-wrinkle/

3. It looks like Reid was instrumental of adding the Botox tax to the health care bill.
A proposal to slap a 5% tax on wrinkle fillers, Botox shots, breast implants and other elective cosmetic medical procedures as part of President Obama's health care reform package is raising disapproving eyebrows among some groups. A coalition of plastic surgeons, a women's group, medical associations and pharmaceutical makers were distraught when Senate majority leader Harry Reid slipped the so-called Botax levy into the health care bill late last month in hopes of raising $5.8 billion over the next 10 years. The tax would apply to elective but not reconstructive plastic surgery and cosmetic procedures.

Read more: http://www.time.com/time/business/article/0,8599,1947841,00.html#ixzz2NXQY60p0

4. Lobbying “won the day” for the botox folks.

Congress has a gigantic new bill to pay for. If it becomes law, the health plan is projected to cost taxpayers a whopping $849 billion over the next decade according to a Congressional Budget Office estimate. That's why they are shining their searchlight into every corner, looking for places where they can raise taxes to pay the price. A few months ago, Congress was poised to add a five percent tax on Botox injections (called by some, the Bo-tax) which was projected to raise $5.8 billion over ten years. But thanks to hard lobbying by cosmetic surgeons and others, the Botox industry has dodged a bullet, and in the opinion of some, thrown a much less powerful industry under the bus.

At the urging of those who opposed the Bo-tax, Congress is now zeroing in on the indoor tanning services as a source of new revenue. Over the same ten-year period, Congress estimates that by slapping a 10 percent tax on all non-therapeutic tanning services they will raise $2.7 billion. That's twice the tax rate they were planning to add to Botox procedures, yet it will likely yield less than half the total revenue. So why the change? Those in the cosmetic surgery industry say they offered up the tanning industry because they want to discourage what they call a damaging (though legal) behavior -– indoor tanning. The tanning industry says… it was all about clout.

http://www.accountingweb.com/topic/t...les-comparison

5. And the derm’s were behind the “switch” from the Botox Tax to the Tan Tax.

Dr. David M. Pariser, the president of the American Academy of Dermatology, said his association proposed that an indoor-tanning tax be considered in place of the cosmetic tax, and that it contacted the offices of senators. “We made the case this will reduce health care costs by hopefully reducing skin cancer in the future — that’s the point — and also raise a little revenue now,” Dr. Pariser said.

http://www.nytimes.com/2009/12/24/fashion/24Skin.html?_r=0

Write your representative and ask him/her to "reinstate" the Botox Tax!

Last edited by Don Smith; 03-14-2013 at 01:23 PM.
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Old 03-14-2013, 01:59 PM   #7 (permalink)
 
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Re: Tax Tax $$ downgraded

Quote:
Originally Posted by JOHN @ URI View Post
I think the stem of all our problems was some people claiming the tanning industry was worth $5 Billion. Which I don't think has ever been true. I would like to see the math behind that number.

When you claim you are worth $5 Billion people start coming after you, they want a piece of that action.

Does anyone have the numbers of what the IRS was able to collect for the 1st full year?
I think that the industry might be $5 billion a year if you include equipment manufacturers, lotion manufacturers, lamp manufacturers, etc.
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Old 03-15-2013, 11:45 AM   #8 (permalink)
 
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Re: Tax Tax $$ downgraded

Here is what I have been posting everywhere I can. This message will be "fleshed out" in a letter I will send to my representatives.

Congress could increase the "revenue" by at least 1.2B by reinstating a 10% Botox Tax on the rich patients of even richer doctors. Easy money.
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Old 03-15-2013, 12:30 PM   #9 (permalink)
 
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Re: Tax Tax $$ downgraded

Quote:
Originally Posted by Don Smith View Post
Here is what I have been posting everywhere I can. This message will be "fleshed out" in a letter I will send to my representatives.

Congress could increase the "revenue" by at least 1.2B by reinstating a 10% Botox Tax on the rich patients of even richer doctors. Easy money.
I think you are missing the political connection between democrats and the AMA; they needed to be thrown some bones to support the Affordable Care Act. The tanning industry was a bone.
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Old 03-15-2013, 12:59 PM   #10 (permalink)
 
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Re: Tax Tax $$ downgraded

True. But the democrats are desperate for more "revenue" (i.e., more taxes) and they would throw their mother under the bus for $1.2B. Also, the medical community has become a "liability" to the democrats as more doctors protest the onerous provisions of Obamacare. So that is why I am writing to democrat politicians and "throwing them a bone" ($1.2B) that they can sink their teeth into.

Nothing ventured, nothing gained.
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