The current proposals to reform health insurance will include massive new tax burdens placed on the American people, a tax burden to the tune of $500 billion dollars over the next 10 years.
Let’s breakdown some of the proposed tax increases..
1. 40% excise tax on health coverage in excess of $8,500/$23,000 ($149.1 billion)
2. Employer W-2 reporting of value of health (negligible revenue effect)
3. Conform definition of medical expenses ($5.0 billion)
4. Increase penalty for nonqualified health savings account distributions to 20% ($1.3 billion)
5. Limit health flexible spending arrangements in cafeteria plans to $2,500 ($14.6 billion)
6. Require information reporting on payments to corporations ($17.1 billion)
7. Additional requirements for section 501(c)(3) hospitals (negligible revenue effects)
8. Impose annual fee on manufacturers & importers of branded drugs ($22.2 billion)
9. Impose annual fee on manufacturers & importers of medical devices ($19.3 billion)
10. Impose annual fee on health insurance providers ($60.4 billion)
11. Study and report of effect on veterans health care (no revenue effect)
12. Eliminate deduction for expenses allocable to Medicare Part D subsidy ($5.4 billion)
13. Raise 7.5% AGI floor on medical expenses deduction to 10% ($15.2 billion)
14. $500,000 deduction limitation on taxable year remuneration to health insurance officials ($0.6 billion)
15. Additional 0.5% hospital insurance tax on wages > $200,000 ($250,000 joint) ($53.8 billion)
16. Modification of section 833 treatment of certain health organizations ($0.4 billion)
17. Impose 5% excise tax on cosmetic surgery ($5.8 billion) link
Many of these tax increases will simply be passed directly to the policy holder in the form of higher premiums. This debunks the assertion that only the rich will be soaked to pay for this severely flawed reform.
These new taxes are only the beginning, as the push for more sin taxes will be the next on the agenda. In addition to the “tan tax” and “tobacco tax”, we are seeing a push for new taxes on soda, beer, wine and liquor, as well as taxes on candy and other sugary food products. Where does it all end? How about the fat tax? Or, perhaps we need a cholesterol tax? Haven’t we had enough of this nonsense?
The only way the Obama administration can meet it’s commitment of making this reform deficit neutral is to increase taxes to the tune of $1.25 trillion dollars over the next 10 years. The idea that we can save $700 billion dollars by eliminating waste and fraud, in addition to cutting Medicare/Medicaid, is truly laughable and clearly a scam.
The Joint Committee on Taxation has released several informative PDFs regarding these new taxes. Estimated Revenue Effects Of The Manager’s Amendment To The Revenue Provisions Contained In The “Patient Protection And Affordable Care Act”. link
We must stand up now and say no to these unreasonable taxes, especially to fund this flawed and dangerous piece of legislation.
Haven’t we all been Taxed Enough Already?