UPDATE 1-NRF asks members to oppose Wal-Mart on health care

(Adds Wal-Mart comment)

NEW YORK, July 13 (Reuters) - The U.S. retail industry's largest trade group is asking its 2,500 members to "take a stand" and voice their opposition to Wal-Mart Stores Inc's (WMT.N) support of employer mandated health care coverage.

"We could stand idly by and allow Wal-Mart to tip the scales on the health care debate ... or stand up for all retailers and come out swinging," said National Retail Federation President and CEO Tracy Mullin in letter distributed to its members and posted on its website on Monday.

The NRF's letter comes after Wal-Mart, which is not a member of the trade group, said late last month that it supports President Barack Obama's push to require large employers to offer health insurance to workers.

Wal-Mart, the world's biggest retailer, said it supports an employer mandate that is "fair and broad," covering as many businesses as possible.

But Mullin said the NRF, whose members range from small retailers to those that ring up billions of dollars in annual sales, was "astonished" to see Wal-Mart support such an idea, which the NRF has said would amount to a "tax" on the industry and could result in the loss of retail jobs.

"Although the move may provide a short-term public relations boost to Wal-Mart, it could have long-lasting, devastating consequences to retailers throughout the country," Mullin wrote in the letter.

For its part, Wal-Mart said the present health care system is not sustainable.

"We know that others may have a different opinion but we believe we have taken a pro-business position and is the right thing to do for our company," according to a statement from Wal-Mart spokesman Greg Rossiter.

Obama has made healthcare reform his top legislative priority. The United States spends more than $2 trillion annually on healthcare, twice the amount of any other nation, but it ranks worse than most developed countries on measures of health like life expectancy.

While the president has left many of the details of health reform to Congress, he has told U.S. lawmakers he is open to requiring larger companies to provide coverage for employees but exempting smaller businesses.

NRF Vice President Neil Trautwein said the group hoped its members would view the letter as a "call to action" and reach out to their member of Congress to voice their opposition to the idea of employer mandated coverage.

(Reporting by Nicole Maestri; Editing by Matt Daily and Richard Chang)