As expected, the ad tax is back on the table as part of the pending health care reform legislation. Jim Davidson, head of the Advertising Coalition, is recommending calls to Senators urging REJECTION of the medical advertising tax proposal of Senator Franken-MN and two cosponsors, Senators Whitehouse-RI and Brown-OH.
Immediate calls are requested because the Ad Coalition has learned that the sponsors hope to have their bill incorporated in the health care reform measure expected to be offered by Senate leaders as early as next week. Senior staff are currently working to consolidate the Senate HELP and Finance committee bills into a compromise measure. If sponsors are unable to have it incorporated in the leadership bill, they are expected to offer it as a floor amendment when the Health Care Reform Bill is debated by the full Senate. See below for talking points, contacts, more information...
The Advertising Coalition and the AAAA D.C. office report that elimination of the tax deduction for marketing costs for drug and related businesses is still among the revenue options to pay for health care reform (HCR). Indeed, Senators Franken-MN, Brown-OH, and Whitehouse-RI have recently introduced S. 1763 to elimnate the deduction for all medical marketing, and have asked Senate leadership to include it as part of the Health Care Reform Bill currently being debated.
It Is Extremely Important for You to Read Each of the Following Documents.
- Examples of letters from the Advertising Coalition to Senators on S. 1763
TACAdTaxLtrMcConnell_Oct09.pdf
TACAdTaxLtrReid_Oct09.pdf - "Talking Points" from the Advertising Coalition.
TAC_talkpts_FrankenAdTax.pdf
Constituents are also urged to add specific information about their agencies, and the number of people employed, and the importance of the information to doctors and patients provided by their companies;
- List of Senate Legislative Directors: the key staff in the Senate, including names, phone, fax and email addresses:
AdTax_Senate_List_Oct09.pdf
- Copy of Senate 1763
s1763_AdTaxBill.pdf
- Ad Coalition Paper on Economic Impact of Advertising in NY's 17th District
EconImpact_TAC_NY.pdf
Here are three papers written by the Washington Legal Foundation concerning the First Amendment and Prescription Drug Advertising:
- Proposed Limits on Prescription Drug Ads: A Constitutional Analysis
wlf_drugads_constitution.pdf
- Bill Denying Tax Deduction For Drug Ads Unconstitutional
WLF_DrugAds_KampFriede.pdf
- Proposal To Deny Tax Deduction For Drug Ad Expenses Unconstitutional
WLF_DrugAds_Kamp.pdf
Background:
Download slides from July 1 special meeting on Ad Tax: tax.pdf
The Advertising Coalition and the AAAA DC office report that elimination of the tax deduction for marketing costs for drug and related businesses is still among the revenue options to pay for health care reform (HCR). President Obama and Senator Baucus, head of the Finance Committee, continue to stress that the HCR bill will be "revenue neutral," meaning that the cost estimate of the final plan will be matched with revenue measures, meaning that this option could be attractive to some Members of Congress.
Given that versions of HCR have been "scored" at over $1 Trillion, the Ad Coalition says every option will be given serious consideration, including the elimination of the deduction for drug marketing costs. Marketing experts estimate that marketing plans would quickly be reduced by over 35%, the approximate tax rate for drug and related businesses.
Hill HCR leaders are currently focused on the various proposals for HCR, but are expected to turn to revenue options over the next several weeks. Jim Davidson, head of the Advertising Coalition, says that now is the time for constituents to communicate by phone, fax or email to key staff members of the House and Senate. Agencies have been urged to focus first on the Senators from all states where they have offices, including New York Senator Schumer and New Jersey Senator Menendez.
If you have any questions, please contact:
Jordan Hass at the Advertising Coalition (JHaas@polsinelli.com; 202-638-1101),
Adonis Hoffman at the AAAA DC office (ahoffman@aaaa.org; 202-331-7345)
or John Kamp (jkamp@cohealthcom.org; 703-801-4582)
I hope they can stop the Ad Tax. That will save so much money.
-Bob
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