Last week President Barack Obama emphasized once again the importance
of doing everything possible to aid small businesses in jump-starting
the U.S. economy. We agree, and that is why we are speaking out about a
very disturbing part of the Health Care Reform Bill that has nothing to
do with health care and everything to do with small business. It is
Section 9006, which would place an unprecedented burden on small
business reporting and paper work requirements.
This provision would require any business that purchases more than $600
of goods or services from another business to submit a 1099 tax form to
the Internal Revenue Service. The mandate, which is to take effect in
2012, was included to help pay for the health care bill and was
estimated to raise $17 billion.
At a time when President Obama and everyone else agrees that our
economy needs small businesses to help our country grow out of this
recession, saddling them with expensive new paperwork requirements only
further hampers their ability to succeed and ultimately aid in our
economic recovery. H.R. 5141 and S. 3578, the "Small Business Paperwork
Mandate Elimination Act" would repeal this section of the "Patient
Protection and Affordable Care Act."
Unless Section 9006 is repealed, businesses across the United States
will be subjected to data collection and information filing on
virtually all business-to-business transactions. This regulation will
force small businesses to divert precious time and resources to collect
volumes of information and fill out mounds of new paperwork for the
government.
This new regulation will not only be expensive for small businesses and
start ups, but also may make it harder for them to conduct business at
all. In addition, Section 9006 may encourage larger businesses to
reduce the number of vendors they work with, which would put smaller
contractors at a real disadvantage.
While this provision may generate some additional revenue for
government, the cost to small businesses will be overwhelming. For
these reasons, the Los Angeles Area Chamber of Commerce urges Congress
to repeal Section 9006 through the passage of the Small Business
Paperwork Mandate Elimination Act (H.R. 5141 and S. 3578).