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 The move by Clinton, the Democratic front-runner in the 2016 White
House race, is a break with the Obama administration that could win
her more backing from some of the labor unions critical to her White
House bid.
Labor unions oppose the tax because their members often receive more
generous healthcare plans and they fear it would raise their costs.
Clinton has been under pressure to oppose the tax as she vies for
union support with her top Democratic rival, U.S. Senator Bernie
Sanders of Vermont, a longtime foe of the tax.
Clinton said the repeal would be another element in her package of
reforms to build on Obamacare. Last week, she offered plans to rein
in prescription drug costs and lower out-of-pocket healthcare costs.
 "Too many Americans are struggling to meet the cost of rising
deductibles and drug prices. That’s why, among other steps, I
encourage Congress to repeal the so-called Cadillac Tax, which
applies to some employer-based health plans, and to fully pay for
the cost of repeal," Clinton said in a statement.
The Cadillac tax, which would not take effect until 2018, is a tax
on employer-based coverage that exceeds the thresholds of $10,200 a
year for individuals and $27,500 for families.
The tax, designed as one of the primary ways to rein in healthcare
costs under the law, would be imposed on employers. They could avoid
it by replacing expensive plans with cheaper ones.
Clinton's campaign said the estimated $87 billion in lost revenue
from repeal of the Cadillac Tax would be offset by her reform plans
released last week.
One component, the requirement that drug companies provide higher
rebates for low-income people covered by the Medicare healthcare
program for the elderly, would generate $100 billion in savings
alone, her campaign said.
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The move follows months of signals from Clinton that she believed
the tax was a problem. She had promised labor leaders she was
looking into possible fixes.
Terry O'Sullivan, president of the Laborers' International Union of
North America, praised Clinton's proposal to scuttle the tax.
"We're encouraged that all of the Democratic candidates for
president and a growing bipartisan movement in Congress are working
to repeal the tax before its implementation in 2018," O'Sullivan
said.
Sanders, a longtime opponent of the tax, introduced a bill with
other Senate Democrats last week to repeal it. The Obama
administration has repeatedly backed the controversial levy.
(Additional reporting by Amanda Becker; editing by Sandra Maler and
David Gregorio)
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