(Bloomberg) -- A new bipartisan effort to cancel Obamacare’s Cadillac tax--the40 percent levy on high-cost health insurance plans--adds a wrinkleto an impending fight in Congress.

The repeal bill unveiled Thursday in the U.S. Senate by NevadaRepublican Dean Heller and New Mexico Democrat Martin Heinrichstands little chance of becoming law soon, especially with BarackObama in the White House.

Yet it demonstrates lawmakers’ frustration with the tax, whichtakes effect in 2018.

“I have not seen a piece of legislation that brings more sidestogether,” Heller said at a news conference in the Capitol onThursday, invoking a coalition of business groups and unionsopposed to the tax, including those that represent casino workersin Las Vegas.

“I think we’re going to see a breakthrough.”

Businesses have already begun planning for the tax and areconsidering trimming health benefits while closely monitoring rulesfrom the Internal Revenue Service.

Read: IRS seeks more input on Cadillactax

About one-third of employers are at risk of paying the Cadillactax in 2018 if they don’t adjust their insurance plans, accordingto Mercer, the benefits consulting unit of Marsh & McLennanCos.

The proportion is projected to quickly rise to exceed 50percent.

Read: Understanding PPACA reportingrequirements

The tax applies to family health-care coverage exceeding $27,500and individual coverage exceeding $10,200, with low inflationadjustments intended to capture more people over time.

Largest tax break

The tax was designed to put pressure on health costs and reducethe benefit of the largest tax break for individuals, which allowsthe value of employer-provided health insurance to escape incomeand payroll taxation.

It has faced bipartisan opposition since the tax was firstproposed. Republicans oppose it as they have almost every piece ofthe Affordable Care Act. Democrats aligned with labor unions alsoobject, as unions have often negotiated generous, untaxed benefitpackages in lieu of taxable wage increases.

Heller and Heinrich said the tax has stymied labor negotiationsand would hurt middle-income workers it wasn’t intended toaffect.

“This is not a Cadillac tax,” Heinrich said. “This is not aLexus tax. This is going to be a Ford Focus tax.”

Many of the tax’s defenders are no longer in office. They haveleft behind frustration and a campaign that has united labor unionsand large companies including Procter & Gamble Co. and PfizerInc. in an effort to repeal the tax.

In the House, a repeal bill by Connecticut Democrat Joe Courtneyhas 145 co-sponsors, and similar legislation by New HampshireRepublican Frank Guinta is supported by 91 of his colleagues.

Budgetary costs

The biggest obstacle for lawmakers, other than Obama’s veto, isthe cost of repealing the tax. It is projected to generate $87billion for the government over the next decade, according to theCongressional Budget Office.

Democrats generally want to replace that money, and their voteswould be essential to overcoming procedural hurdles in the Senateand a possible veto.

Representative Lloyd Doggett, a Texas Democrat, said he hasnever supported the tax and worries about its effect onmiddle-income families. That said, he doesn’t want to undermine thebroader aims of the health-care law.

“It is a mistake to take away revenues from the Affordable CareAct without replacing them,” he said in an interview earlier thisyear. “Those who are advocating the repeal of the Cadillac tax area collection of very mixed motives.”

The Courtney bill is H.R. 2050. The Guinta bill is H.R. 879.

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