Union Coalition Opposes Excise Tax

January 13, 2010

A group of 16 unions, including AFSCME, representing nearly nine million federal and postal employees and retirees sent a letter to key leaders in Congress this week calling for the removal of the proposed excise tax on high-cost insurance plans included in the Senate's version of health reform legislation.

As reported by the Huffington Post, the unions object to the so-called "Cadillac tax" because it will unfairly target working-class families.

From the letter:

Characterizing this tax proposal as a "Cadillac tax" is a misnomer. It hits the average blue collar and white collar employee or annuitant. FEHBP [Federal Employees Health Benefits Program] insurers will simply reduce coverage and, as the taxes increase, a downward spiral towards less coverage will ensue, which is antithetical to health care reform's states purpose. Penalizing FEHBP enrollees with this tax is a huge disincentive to qualified applicants seeking federal or postal employment. It is bad for the government and bad policy overall.

The following unions signed the letter:

American Federation of Government Employees
American Foreign Service
Association American Federation of State, County and Municipal Employees
American Postal Workers Union
Federal Managers Association
Laborers' International Union of North America
National Active and Retired Federal Employees Association
National Air Traffic Controller Association
National Association of Letter Carriers
National Association of Postal Supervisors
National Association of Postmasters of the United States
National League of Postmasters of the United States
National Postal Mail Handlers Union
National Rural Letter Carriers' Association
National Treasury Employees Union
Professional Aviation Safety Specialists

Read the full letter. (PDF)