Proposed 10% Sales Tax Pending on Indoor Tanning Services!

Good morning and Happy New Year!

I wanted to take this opportunity to express, to each of you, sincere thanks for your continued patronage of your Wolff Tan locations. Without you, well, we wouldn't be here.

With that expressed, and because you have an interest in indoor tanning, I am asking that you consider reading the following information with hopes that you may take a few minutes and write your thoughts on the link at the end of this letter on the prospect of paying a 10% tax for indoor tanning services. The following sums up what was going on before the Holidays with the Proposed Health Reform Bill...

Legislative Alert -- 10% Federal Tax Proposed on Tanning Services

Situation -- Late Saturday, the Senate Democratic Leadership released the text of its version of the Healthcare Reform legislation. The bill included a 10% tax on tanning services -- services involving ultraviolet light – to pay for other costs incurred under the proposal. The Joint Committee on Taxation has scored the tax on tanning to raise $2.7 billion over the next 10 years or approximately $270,000,000 in revenues annually.

From a procedural standpoint, the Senate bill is currently being considered on the floor, with final passage likely to take place on Christmas Eve. Once the bill passes the Senate, the bill will have to be reconciled with another very different version of Healthcare Reform which passed the House of Representatives earlier and which does not contain the 10% tax on tanning.

The reconciliation of the two different bills takes place in a conference committee where a small group of House and Senate members draft a final bill which then has to pass both Houses of Congress in an identical form.

As this process of reconciliation will not happen overnight and will probably take at least several weeks to a month to play out, this gives us an opportunity to mobilize our biggest resource, the industry and all of our employees and customers to assist with our advocacy and communications efforts.

Background – Our team on Capitol Hill tells us this new tax was inserted at the last minute as an alternative to a proposed tax on elective cosmetic procedures contained in the original Senate bill at the behest of a coalition that included Allergen, (the company that manufactures Botox), the American Academy of Dermatology, the American Academy of Facial Plastic and Reconstructive Surgery and probably the American Medical Association. Allergen alone hired six lobbying firms and probably spent over $300,000 in the last month on the effort to knock out the ‘Botax”. The money spent on direct lobbying does not include its PAC contributions. The medical societies were willing accomplices in this effort and added their lobbying firms and PACs’ dollars in support of Allergen.

As many of you may know, this measure passed the Senate and is now in negotiation with the House. The following is the email I just received from the Indoor Tanning Association...

Legislative Alert – January 4, 2010

This will be a crucial week in Washington for the Tan Tax. Lawmakers will return to the Capitol today to begin putting together the final healthcare reform bill. It will be a closed process, with a select group of approximately a dozen House and Senate members, deciding how the bill will be financed and we have to make sure our industry is heard.

The good news is that we have made tremendous progress with our grassroots campaign with a total of over 98,000 emails sent to the Congress since the campaign started on December 22. We have to keep up the pressure. Our goal is to double that number by week’s end. Thus far, customers are by far the biggest source of messages to the Hill comprising over 80% of the emails sent. Please log onto www.theita.com/home/healthcarereformbill.htm to sign a petition to help fight this unnecessary tax.

Best Always...

Shelly