More Republicans Sign On to Cadillac Tax Repeal

Eleven more Republicans have signed on to legislation in the House repealing Obamacare’s Cadillac tax in the weeks since they put forward their alternative health care plan. More than 300 members now support repeal.

“Middle-class families depend on employer health benefits, a crucial supplement to mom and dad’s salaries, to make ends meet,” Rep. Frank Guinta (R-NH) said in a statement. “Three hundred cosponsors of legislation to permanently ax the tax is a milestone. I’m proud to have introduced the first standalone bill. One way or another, the ‘Cadillac Tax’ will meet its end.”

The Cadillac tax is a 40 percent excise tax on employer-sponsored health care benefits exceeded a certain threshold. It was included in Obamacare as a way to pay for the law and as an attempt to curb healthcare spending.

The tax is opposed by a diverse array of interest groups, ranging from unions to Fortune 500 companies. These groups say it will unfairly burden workers.

Last year, Congress delayed implementation of the tax from 2018 to 2020. The Alliance to Fight the 40, the group of stakeholders lobbying against the Cadillac tax, has continued to push for full repeal.

However, while the tax is unpopular with members of both parties, Republicans have put forth a similar measure in their Obamacare alternative. They have proposed capping benefits’ tax-exempt status at a certain level. While there are differences between this method and an excise tax, the Alliance is wary of a cap as well.

“We appreciate that the proposal includes the categorical rejection of the ‘Cadillac Tax’’ said James Klein, President of the American Benefits Council, in a statement released after the GOP plan was unveiled. “In addition, we must be cautious of any policy changes that disrupt the health care marketplace by shifting costs to workers—including the report’s proposed caps on the employee exclusion from taxation.”


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