This week the credit unions stormed the Hill holding meetings with every member of Congress and telling them they need a repeal of the swipe fee reform enacted last year or else they will never make a profit. Rumors swirled all week of potential legislation that would be introduced this year to take away retailers hard won debit card reform.
Next week NACS members take to the Hill for our own meetings with Congress. Retailers will deliver the message that debit reform is necessary to fix a broken marketplace that operates without competition. We will debunk the myths that banks are telling...but we need your help. To support all of our efforts next week we need every retailer to send emails, letter, and faxes to their own Member of Congress. Go to nacsonline.com/grassroots to send the "Support Swipe Fee Reform" letter to your Representatives.
Stayed tuned next week for reports from all of our Day on the Hill activities.
NACS Staff Contact: Lyle Beckwith, lbeckwith@naconline.com
Yesterday afternoon the U.S. House of Representatives voted 314 to 112 to repeal the unpopular 1099 tax provision contained in the health-care law, reports the National Journal. However, it??s unlikely the Senate will provide similar support.
According to the news source, the House bill offsets the estimated $17 billion in lost revenue from the 1099 requirement by requiring those on the threshold of 400 percent of the federal poverty limit to pay back insurance exchange subsidies if their income increases over the course of a year. House Democrats who oppose the measure say it would impose tax increases on the middle class.
"If this bill would become law, it would mean a tax increase for hundreds of thousands of middle-income taxpayers," House Ways and Means ranking member Sander Levin (D-MI) said during debate, adding, "What this bill would do would be to saddle middle-income taxpayers in future years, pure and simple."
Although businesses don??t have to fill out the actual 1099 tax forms until 2013, they will have to get ready to track all purchases over $600 in 2012 to comply with the reporting requirement. Such uncertainty could affect purchasing and accounting decisions.
House Majority Leader Eric Cantor (R-VA) commented that the next step is negotiation between Senate and House versions of the measure.
"We'll have to see where the differences lie between the two bills," Cantor said. "Hopefully we can get this to the president??s desk as quickly as possible."
In early February the Senate voted 81 to 17 to roll back the 1099 tax reporting requirement, although it??s version of the bill would authorize the Office of Management and Budget to find an equal amount of unused funds, essentially punting the responsibility of coming up with the cash.
NACS Staff Contact: Julie Fields, jfields@nacsonline.com
The Tobacco Product Safety Advisory Committee is due to submit a report to the FDA outlining the most effective ways to regulate the sale of tobacco, including recommendations on the regulation or ban of menthol cigarettes. NACS is concerned that the committee has not examined the effects these regulations or potential bans could have and the black market situations they could create.
In a letter sent yesterday NACS made the following important points:
- A decision to ban menthol cigarettes will cause a significant expansion of the current black market for cigarettes in the United States. Common sense tells you that if there is a market for an existing product - and if that product is made illegal - some portion of that existing market will go to the black market. A menthol ban will undoubtedly lead to a black market in menthol cigarettes because of the broad consumer base that exists among adult smokers. NACS firmly believes that a ban on menthol would provide a spark that the black market needs to push it into a more burgeoning problem in our country.
- A ban on menthol will aggravate, not mitigate, underage smoking problems. The purveyors of menthol cigarettes, operating outside of the law, will not discriminate among their customers based on age. This is not speculation or supposition. Canada today suffers from an extensive contraband market where sales occur at doorsteps and street corners. Studies concluded that those under 19, who are prohibited from purchasing licit cigarettes, have no trouble getting their hands on cheap, illegal cigarettes. Because smugglers don??t care about age verification, contraband sales undercut the efforts of retailers to prevent minors from purchasing tobacco.
- A black market will create other health concerns. Overall, one in three cigarettes purchased in Canada is illegal. Today in the United States, manufacturers operate within the full scrutiny of the FDA in satisfying customer demand. Illegal manufacturers, obviously, will not, meaning that cigarette contents, purity, nicotine and tar levels, to name just a few issues, all will subject to their whims. Congress specifically recognized in the Tobacco Control Act that the FDA should play a role in regulating the manufacture of cigarettes; banning menthol will eliminate the important public health safeguards that Congress intended in that Act.
NACS Staff Contact: Lyle Beckwith, lbeckwith@nacsonline.com