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Obamacare's Pizza Tax: Taxing an Even Larger Slice


Posted by Justin Sykes on Friday, August 10th, 2012, 11:33 AM PERMALINK


Papa John's founder John Schnatter caused a stir this week with his comment that the Obamacare law would cause a "hike in pizza prices." The most stirring thing about John Schnatter's statement is...that it's true. As a result of Obamacare employers such as John Schnatter will be forced to change their workforce strategy, which means increasing the costs of products offered to consumers as well as layoffs.

In a study recently released by Mercer, analysts surveyed 1,203 employers, 60% of which were preparing for an increase in cost as a direct result of Obamacare. Of employers hit the hardest by Obamacare, Mercer found the effects would primarily hit retail and hospitality employers who employ "the most part-time and low-paid employees."

To exemplify the effects Obamacare will have on employers:

  • Beginning in 2014 employers will be required to extend coverage to all employees working 30+ hours per week or face possible penalties.
  • A fourth of all survey respondents said they will have to take action to avoid...penalties.
  • Retail/ wholesale employers...are more inclined to change their workforce strategy.

 

The Cost of Obamacare is not reserved to retail and hospitality:

Cost impact of Obamacare by Industry
Retail and Hospitality 46%
Health Care Services 40%
Manufacturing 33%
Financial Services 32%                                                   
Transportation/ Communication/ Utility 31%
Other Services 29%
Government 24%

 

If legislative action is not taken, the effects of Obamacare will be widespread, hurting employers and potentially costing part-time and low-wage employees their jobs.

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