Farm Bureau calls on Congress to repeal Health Insurance Tax

The American Farm Bureau Federation has joined a coalition of small business groups urging Congress to provide relief to rural communities when it comes to health insurance.

The coalition is seeking the repeal of the Health Insurance Tax, or HIT, because of the burden the tax places on rural businesses, farmers and ranchers.

The tax was created by the Affordable Care Act to help pay for the legislation. Congress last year voted to impose a one-year delay of the tax until 2018.

According to AFBF tax specialist Pat Wolff, the tax would increase the cost of insurance for farmers and ranchers.

“Farmers have two issues with health insurance: one is how much it costs, and the other is, is it available in rural areas,” she said. “The HIT tax comes straight to how much does insurance cost. It raises the cost of health insurance and it makes it harder for people who have to buy their own insurance to pay for insurance or to upgrade and get higher quality coverage.”

Wolff explained that the tax is imposed on insurance companies based on the premiums they collect, but the companies pass the cost along to their customers.

“The insurance companies just pass this along to people who have to buy their own health insurance to the tune of about $500 per family per year, and that’s a lot of money for farmers and ranchers,” she said.

She added that small business owners along with farmers and ranchers need tax certainty and security of additional relief from the tax.

“If you shouldn’t collect in 2017, you shouldn’t collect it in 2018, or 2019, or ever,” she said. “There’s a wide range of small business groups who are pushing for repeal of the HIT, and they’ve called on Congress to act when they get back after the election to make sure that there isn’t just a one-year moratorium, that the repeal of the HIT goes on for more than one year.