Rector: "The Ways and Means Committee is scheduled to release it's list of revenue options for healthcare reform on Friday [TOMORROW!]. We are down to the final hours that we have to convince members of the committee and others in the House of Representatives, that it would be bad policy and very harmful to media and advertising industries to impose a tax on the advertising of prescription medications. By denying the ordinary and necessary business expense deduction for this advertising, it would be the first time in history that the Congress would have targeted one form of speech and made it more expensive in order to discourage people from speaking.
Every advertising club member, every newspaper publisher, every magazine publisher, every broadcaster who calls his or her Member of Congress is critical to this effort. We only have a few hours left. Be sure that every member of Ways and Means hears our message."
Clark's message may be read seen in the AAF Government Affairs bulletin linked at right. His message includs a letter from Global Insight that predicts that potential tax revenue from the proposed DTC Ad Tax is far less than the Ways and Means Committee estimates.
Clark also attached a letter from the Advertising Coalition (comprised of the AAF, 4A's, ANA Broadcasters and other media) urging the House Ways and Means Committee to look elsewhere for healthcare reform funding because in addition to raising only modest tax revenue the DTC Ad Tax is an unconsitutional restriction of speach and will further slow the economic recovery of the advertising industry.
Email Maryland Congressman Chris Van Hollen who is on the Ways and Means Committee and let him know that you do not support the DTC Ad Tax and that it will have a devastating impact on the advertising industry! Then email your Congressmen.
Here is suggested text:
Dear Congressman ______:
As a taxpayer working in Maryland's advertising industry, I oppose any effort to eliminate tax deductions for the cost of advertising prescription drugs. There are several compelling reasons NOT to eliminate the deduction of advertising prescription drugs as ordinary and necessary business expense:
- It will increase the cost of informing the consumer about prescription drugs by 35%. If an advertiser is taxed at the highest corporate rate of 35%, the loss of the deduction for prescription drug advertising becomes a 35% tax on such advertising.
- Taxing advertising expenses for prescription drugs but not other advertising expenses is discriminatory.
- Taxing advertising expenses for prescription drugs chills constitutionally protected commercial speech. In 1936, the Supreme Court struck down a 2% tax on newspapers as an unconstitutional restraint on speech in Grosjean v. American Press Co.
- Consumers - particularly elderly consumers - will receive less information about prescription drug choices if advertisers reduce spending on prescription drug advertising.
- Legislation requiring a tax on advertising expenses for prescription drugs will make it easier to tax other advertising expenses, adversely affecting the advertising industry.
Sincerely,
Your Name
Address
