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Old 12-08-2016, 07:14 AM   #1 (permalink)
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Thumbs up ITA Update 12/7/2016

Executive Director's Report - There is a New Sheriff in Washington

To say the results of November, 2016 election caused an earthquake in official Washington would be a gross understatement! The transfer of power which is carried out through the President-elect's "transition team" had started even before the election results were final and is in full swing. This process will continue through Inauguration Day.

In an election where there is a change in the party in power in the White House, it is often the practice for the rulemaking process to be put on hold until the incoming president has an opportunity to get his team in place. Before the inauguration, the questions for our industry are whether or not the departments and agencies will be deferential to the new president in the closing days before the new administration is sworn in, and if not does the FDA have the time to issue the final rules before President-elect Trump takes office?

At the end of a presidential term, there is typically a logjam at the top of the Agency with various department heads within the FDA jockeying for final approval and publication of their respective rules before the clock runs out. As the Obama Administration winds down, we know there are many much bigger issues than sunlamps still in the pipeline at the FDA. We hope that plays to our advantage.

We also know neither of the proposed rules have been submitted to the Office of Management and Budget (OMB). Any proposed rule that is deemed to have a significant impact on the affected industry must be finally approved by OMB before it is finalized. This is significant for the under 18 ban because the FDA stated in the proposed rule that it would have a significant impact. For the amendment to the performance standard, the FDA said the economic impact is unclear. Therefore, it is not certain that the amendment to the performance standard will go back to OMB. So we are encouraged but still not out of the woods until Inauguration Day; Friday, January 20th.

With regard to the Tan tax, there will almost certainly be good news in the next Congress but it is very unclear how quickly the good news will come. President-elect Trump has stated his intention to repeal and replace Obama Care and the Republicans on Capitol Hill have the votes to do that. But exactly what President-elect Trump and the new congress will do is hard to determine.

President-elect Trump and other Republican leaders have expressed support for some aspects of the law (coverage for pre-existing conditions; coverage under a parent's policy until age 26) so an immediate outright repeal is unlikely. It is also unlikely because even the Republicans would be reluctant to pull health insurance out from under an estimated 20 million people without a plan to replace the coverage. Unfortunately, this law is a tangled mess and even industry allies on the House of Representatives' committee responsible for the tax laws said it could take a while to work through the tax issues in Obama Care.

Another avenue for repeal of the tax will be available in the promised overhaul of the tax system, but the timing for that is also unclear. The bottom line is that right now, it is obvious a number of changes are in the works but no one knows exactly what and when.
As we end 2016 and move to the New Year, for the first time in a long time we will have friendly politicians controlling both the Executive and Legislative Branches and we can see good news on the horizon.

On behalf of the ITA Board, we wish you a joyous holiday season every success in the New Year.
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Old 12-08-2016, 08:54 PM   #2 (permalink)
 
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Re: ITA Update 12/7/2016

I'll give the tan tax about a 50/50 on appeal. Even if it does happen your looking at
about 3 years before it's over.
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Old 12-09-2016, 06:29 AM   #3 (permalink)
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Re: ITA Update 12/7/2016

Agreed. If it is repealed it will be part of a broader tax reform bill and probably have nothing to do with any industry efforts......
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