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Find Some Shade Because the Tanning Tax Hits Tomorrow

June 30, 2010

Unfortunately, no amount of sunscreen or Aloe will relieve the pain of the Democrats’ impending 10 percent tax on indoor tanning beds,which goes into effect tomorrow, July 1.  This $2.7 billion tax will hit tens of thousands of small businesses and consumers and is just one of the many of the $569,000,000,000 in new health care taxes that violate the President’s promise not to raise taxes on middle-class families.

Despite the size and reach of this new tax increase, many Americans and small businesses are unaware of this provision or how to comply with it.  According to a survey taken earlier this month, “only 5 percent of tanning business owners in the poll said they had been contacted by the government. Fully 95 percent say they are flying blind about how to collect the tax.”

On June 11, 2010, Ways and Means Ranking Member Dave Camp (R-MI) wrote to IRS Commissioner Doug Schulman asking whether the IRS would engage in aggressive outreach to notify Americans affected by the health care law’s new tax on tanning services. Camp noted that that the IRS sent over 4 million postcards advertising a small business health care tax credit that many employers are ineligible to receive. The IRS has yet to explain why it has not notified tanning operators about this tax.

Below are excerpts from “By the Numbers” put together by the National Federation of Independent Business, Indoor Tanning Association and the International Franchising Association on the new tanning tax.

2.7 billion: The amount of money the IRS plans to collect from small businesses over
the next 10 years from this tax.

~19,000: Number of “mom and pop” small businesses who may be affected by the
new tax.

12: Number of pages it takes the IRS to explain the rules to comply with the
complicated “suntan tax.”

36: Number of hours estimated by the IRS to complete and file Form 720,
prior to the IRS revising and adding the new suntan tax to it.

>$74: Average cost, per hour, spent by small businesses to comply with federal
tax paperwork burdens.

>4 million: Quantity of postcards mailed to small businesses alerting them to the
availability of a small business tax credit.

0: Number of postcards sent to alert tanning businesses of the new tax on
their business.

2: Number of weeks in advance small businesses received the regulations for
complying with the new suntan tax.