Republicans Object Twice To Repealing 1099 Provision

Earlier today, Republicans twice objected to repealing the 1099 reporting requirement, which would require small businesses to report transactions of more than $600 to the IRS. Sen. Debbie Stabenow (D-MI) tried to attach the repeal provision to the just-passed tax compromise but Republicans — who have argued that the provision would burden small businesses — struck down the request. Separately, Sen. Max Baucus’ (D-MT) attempted to move the Senate to consider a repeal measure was also shot down after Republicans requested to replace his amendment with a Republican alternative offered by Sen. Mike Johanns (R-NE):

STABENOW: I would ask for another 10 seconds to offer a unanimous consent request in order to set aside the second degree amendment to the Reid McConnell substitute to offer an amendment number 4773 that would repeal the 1099 reporting requirement for small business.

KYL: I object.

Watch a compilation of the two objections:

Ultimately, this isn’t very surprising, since Republicans see the 1099 repeal issue as a good way to start the ball rolling on unwinding the health care law and a convenient way to frame their more general argument about the Affordable Care Act. The administration and Congressional Democrats have all condemned the provision as burdensome and overreaching and Republicans are hoping to extend that argument to the entire law. In this sense, the longer the 1099 remains an issue, the better.

What’s more, including the amendment in this tax compromise would could allow both parties to take credit for the measure. Should it pass individually — in the way that Sen. Mike Johanns (R-NE) has suggested — the party can wrap themselves in small business respectability and use it to build momentum to go after other provisions in the law.

The only substantive difference between the Johanns and Baucus amendments is that Johanns is paid for and Baucus isn’t. But given the fact that Republicans supported an overall tax agreement that would add some $850 billion to the deficit, their objection to the Baucus bill shouldn’t be taken too seriously. But even if we do, Johanns can simply do what Baucus tried — go to the Senate floor and attach his measure to the tax agreement. Asked why he’s not interested in doing so, a spokesperson for the Senator said Johanns respects the “framework” of the existing agreement.