Cosmetic Surgery Tax Out, Tanning Tax In For Sen Health Bill

by Martin Vaughan ,  DOW JONES NEWSWIRES | 2009-12-19

 WASHINGTON -(Dow Jones)- U.S. Senate Democrats boosted payroll taxes on wealthy Americans and proposed a new 10% tax on indoor tanning to help pay for late changes to a broad health-care reform bill.

But Senate leaders dropped from the bill a 5% tax on all elective cosmetic surgeries that had been in an earlier version. Allergan Inc. (AGN), along with Medicis Pharmaceutical Corp. (MRX), and other firms lobbied against that tax, arguing that it was unfair to working women.

The tanning bed tax was inserted in lieu of the cosmetic surgery levy, also known as the Bo-tax, according to a Democratic aide.

The package of changes unveiled Saturday by Senate Majority Leader Harry Reid (D., Nev.), includes a 0.9% add-on to Medicare payroll taxes for individuals earning more than $200,000, or couples earning more than $250,000. That is up from 0.5% in an earlier version of the bill.