Larry Sillanpa

The U.S. Senate has joined the House of Representatives in introducing bills to repeal the 40% tax on health benefits that has had unions up in arms since the Affordable Care Act (ACA or Obamacare) was passed. ACA became law in March 2010 but some provisions don’t become effective until 2020.

The 40% tax, called the Cadillac tax by its opponents, would be levied against health care plans, like union/employer plans and those of large corporations, that have done a good job of providing benefits to their plan members. It is set to go into effect in 2018.

But Senator Sherrod Brown (D-OH) has introduced the ‘‘American Worker Health Care Tax Relief Act of 2015” to repeal the 40% tax on health benefits. The bill also includes a “Sense of the Senate” clause demanding that any repeal be offset so it does not increase the federal deficit or negatively affect the health insurance coverage that 9.9 million Americans have received because of the ACA law.

Sen. Dean Heller (R-NV) and Sen. Martin Heinrich (DNM) have also introduced S.2045, the “Middle Class Health Benefits Tax Repeal Act of 2015’’ to defeat the 40% tax. In the House Rep. Frank Quinta (R-NH) authored H.R. 879 and Rep. Joe Courtney’s (D-CT) H.R. 2050 have attracted 222 co-sponsors to repeal the Cadillac tax.

Labor officials are members of the Alliance to Fight the 40 coalition. AFL-CIO President Richard Trumka stated, “America’s working families are encouraged by the bipartisan leadership to improve access to comprehensive health benefits. Passed more than five years ago, the Affordable Care Act’s main goal of making health care affordable has remained threatened by an unfair and unnecessary tax on quality care. Legislation like (these bills) present important opportunities to work across party lines to improve health care for working people in every state, blue or red. All leaders who support quality, affordable care should join in these efforts.”

“If enacted (the bills) will ensure that millions of Americans won’t have to face forced benefits cuts,” said LIUNA General President Terry O’Sullivan. “This needs to be a bipartisan effort and we believe that with the two bills now introduced in the Senate we will be able to see this regressive tax repealed once and for all." 

For more information on the 40% Tax on Health Benefits, visit or follow on Twitter @Fightthe40.