Lawmakers Seek Excise Tax Relief for Tanning Salon Industry

July 20, 2020

The Honorable Steven Mnuchin
Secretary of the Treasury
Department of the Treasury
1500 Pennsylvania Ave, N.W.
Washington, D.C. 20220

Dear Secretary Mnuchin,

Thank you once again for your efforts to provide relief to businesses across America throughout this national emergency. Your work to keep small businesses open and Americans employed has saved the U.S. from a devastating collapse. As we work to safely reopen in the months ahead, I want to once more respectfully request that Treasury provide much needed relief to the indoor tanning salon industry by ceasing or at least delaying the collection of the excise tax on their services.

The past few months have been devastating for the indoor tanning salon industry. Unlike other businesses that have been able to continue offering limited services throughout the shutdown, tanning salons have come to a grinding halt with no alternative revenue source to mitigate losses. Since February, nearly 4,000 employees have lost their jobs as 411 salons across the country have been forced to permanently close their doors.

Even with the federal assistance programs you've worked with Congress to create, these salons and jobs could not be saved. Quarter 2 excise taxes will only do more irreparable harm, especially when combined with extended operational restrictions and the costs of purchasing protective equipment and cleaning supplies that will continue to hamper revenue for months to come. Additionally, Paycheck Protection Program funds cannot be used to pay taxes. If current conditions persist, roughly 14,000 employees are projected to be out of a job by the end of the year due to 1,500 additional salon closures.

Treasury has already taken action under IRC section 7508A(a) to delay excise taxes for several other ailing industries during this crisis. Most recently. Treasury has delayed collection of the excise tax on sport fishing and archery equipment, both of which can be sold online unlike indoor tanning services.

The Internal Revenue Service exempted gyms and health clubs from the excise tax on indoor tanning in 2012 and has continued to do so. Even in good times, the 10% excise tax creates an unfair advantage for gyms and health clubs competing with indoor tanning salons, with the largest operator in the nation now being an untaxed gym chain; but as coronavirus has shut down salons in their busiest months and threatens to limit revenue for months to come, many of these main street businesses will collapse without federal assistance.

Given the thousands of jobs on the line across the country, I ask that you cease or at least delay the collection of the federal excise tax on indoor tanning services. I appreciate your consideration of this request.

Sincerely,

George Holding
Member of Congress

Mark Amodei
Member of Congress

Mike Bost
Member of Congress

David Rouzer
Member of Congress

Martha Roby
Member of Congress

Drew Ferguson
Member of Congress

Jackie Walorski
Member of Congress

Rodney Davis
Member of Congress

Kenny Marchant
Member of Congress

Billy Long
Member of Congress

Don Bacon
Member of Congress

Ken Calvert
Member of Congress

Andy Barr
Member of Congress

Bradly Byrne
Member of Congress

Tom McClintock
Member of Congress

Doug Lamalfa
Member of Congress

John Shimkus
Member of Congress

Tom Cole
Member of Congress

Dusty Johnson
Member of Congress

Adrian Smith
Member of Congress

Tom Emmer
Member of Congress