Dubbed “Obamacare’s first pledge-breaking tax hike” by Americans for Tax Reform, a “tanning tax” was imposed at tanning salons nationwide on July 1.
According to the IRS Web site, a 10-percent excise tax has been placed on indoor tanning services under the Affordable Care Act. This includes products that use ultraviolet lamps, but not spray tanning or products such as lotions and creams.
According to a statement from the Indoor Tanning Association (ITA), about 18,000 small businesses will be affected. This includes not only tanning salons, but also retail, manufacturing, and distribution businesses.
“Because tanning is something people do with disposable income, this industry has already been hit hard by the recession,” a press release denouncing the tax hike stated. “If someone is concerned about their job, paying the mortgage or buying groceries and gasoline, that person is not likely to spend money on a suntan.”
At Unique Tan in Santa Barbara, the continuing business says differently. General manager Vanessa Bush said her business, which includes three locations, has not been affected.
“Customers aren’t going to stop tanning,” she said. “They aren’t shocked, and no one has said they’re going to stop.”
She said the tax at 10 percent is unreasonable; a tax closer to sales tax would have been understandable. She was also displeased with the execution of the tax. As July 1 was drawing near, she was unaware about how to collect the tax. In addition, she said it was a hassle to update all her computer software after-hours on the night of June 30.
“I hardly think this is the appropriate time to raise taxes on our nation’s smallest businesses, the very people who can least afford new and complicated taxes,” said Dan Humiston, president of the Indoor Tanning Association, in a joint release from the ITA, the International Franchise Association, and the National Federation of Independent Business.
“This directly violates the promise President Obama made not to raise taxes on the middle class. A tax like this could be devastating to thousands of ‘mom and pop’ tanning businesses across the country.”