INN Blog

More Posts

Be a happy psycho!

 

Outdoor Gear Company's Error Spawns Rumors That Go Viral

By Carole Fader
Proquest LLC

Times-Union readers want to know:

Is it true that the health care law will apply a hidden tax to hunting and fishing equipment?

No.

This viral email actually has an understandable reason behind it, though - mainly because an outdoors equipment company made a mistake and started rumors floating.

On Jan. 1, according to FactCheck.org, Cabela's applied a 2.3 percent "medical excise tax" to some of its customers' purchases. It shouldn't have.

As we have written about previously, the Affordable Care Act includes a 2.3 percent excise tax on some medical devices to help pay for expanding health coverage for the uninsured. But it's a tax assessed to manufacturers and importers of medical devices, not one that consumers will have to pay.

Again, the tax applies to medical devices, such as pacemakers. A "retail exemption" in the law covers items generally purchased by the public for individual use, such as eyeglasses, contact lenses, hearing aids and bandages. Some devices that are exported can be sold tax-free, too.

The viral email claims that Cabela's was "outing" the hidden tax by refusing to hide it on its receipts.

Cabela's spokesman Joe Arterburn told the Omaha World-Herald that a "glitch" in the Sidney, Neb.-based company's cash register system led to the errors. Consumers had notified the company that the medical excise tax was on their receipts for items bought on Jan. 1. Cabela's corrected the error the same day and said that it would issue refunds to those affected, the World-Herald reported.

Still, before the story came out, some customers circulated images of their receipts online as evidence of the "hidden" tax in the health care law. And the issue is still appearing in area inboxes.

The Omaha newspaper reported:

"One rumor alleged that retailers had begun passing their employees' insurance coverage costs onto consumers in the form of a medical excise tax. Other sites claimed that because the tax had been applied to shoes and shirts that clothing and footwear are now considered medical devices under the new law. Both speculations are false."

Social Security changes you need to know now.

Arterburn told the World-Herald that he was not sure how the error was triggered.

The viral email was made worse by inclusion of misinformation showing that the medical tax also applies to "sport fishing equipment; fishing rods and fishing poles; electric outboard motors; fishing tackle boxes; bows, quivers, broad heads, and points; arrow shafts; coal; taxable tires; gas guzzler automobiles; and vaccines." Not even close.

FactCheck.org, PolitiFact.com, Snopes.com and urban legend researcher David Emery of About.com all agree that the originator of the email got confused by IRS' publication 510 that deals with excise taxes in general.

Emery notes that while you will indeed find items such as sport fishing equipment and bows and arrows listed as taxable in Chapter 5 of the publication, along with coal, tires, and gas-guzzling vehicles, none of these are categorized as medical device excise taxes. In fact, the fact-finding organizations say, every one of these items was subject to federal excise taxes before the Affordable Care Act.

Because of its almost total violation of the truth, PolitiFact.com rated this claim as "Pants on Fire."Carole Fader: (904) 359-4635FACT CHECKWant something checked out? If you see or hear about something that needs a Fact Check, e-mail carole.fader@jacksonville.com

Copyright: (c) 2013 ProQuest Information and Learning Company; All Rights Reserved.
Wordcount: 542



USER COMMENTS:

comments powered by Disqus

  More Health Insurance News

More Health Insurance News >>
  Most Popular Health Insurance News

More Popular Health Insurance News >>
Hot Off the Wires  Hot off the Wires

More Hot News >>

insider icon Denotes premium content. Learn more about becoming an Insider here.
Social Security changes you need to know now.