The life insurance industry expressed concern over the 3.8% tax in a March 24, 2010 letter to the Senate. The letter states that the tax will hinder individual efforts to save for retirement — it will service as a “disincentive to save in a product that uniquely allows an individual to accumulate savings and to guarantee that savings can never be outlived.” The letter was signed by the National Association of Fixed Annuities, the American Council of Life Insurers, the National Association of Health Underwriters, the Insured Retirement Institute, and the National Association of Insurance and Financial Advisors.
The 3.8% tax will go into effect in 2013.