So much for the promise not to raise taxes on the middle-class.
Douglas Holtz-Eaken and Alex Brill have written an Op-Ed for the Wall Street Journal titled Another Obama Tax Hike: The Senate Health-Care Bill Would Raise Effective Marginal Tax Rates on Lower and Middle-Income Singles and Families up to 41%:
[The Senate health care bill raises] to shocking levels the effective marginal tax rates (EMTR) on lower and middle-income singles and families–with the government taking up to 41% of each additional dollar. …
The solid line shows the EMTR based on income tax law prior to the health-care bill (it excludes the impact of the payroll taxes). The dashed line displays the damaging increases in the EMTR assuming the health insurance premium subsidies contained in the Senate health-care bill and insurance cost estimates provided by the Kaiser Family Foundation.
As a family’s income rises above 133% of poverty, Medicaid eligibility will be eliminated but a family that does not receive health insurance from their employer will receive a subsidy to purchase health insurance in the “exchange.” In turn, however, as their efforts yield higher income, subsidies are clawed back or effectively taxed away.
The current law policies show that there are already some lower income families facing EMTRs above those in the middle class. But the barrier to success imposed by health-care reform is even more striking. According to the Congressional Budget Office, about 20 million people would receive a subsidy to purchase insurance through an exchange and thus face a higher EMTR.
If this Congress passes healthcare reform at all it will most likely be the current Senate bill which passed when Democrats held a filibuster-proof majority in the Senate. Now, because of the election of Republican Scott Brown to fill Ted Kennedy‘s seat, it’s highly unlikely that a new Senate bill would get the 60 votes needed to prevent a Republican filibuster.
Mr. Obama has said that he will sign the Senate bill, so, if Speaker Pelosi somehow gets the House to adopt it, we will, according to Holtz-Eaken and Brill, have that middle-class tax hike the President has repeatedly promised we wouldn’t have.
See what happens when you support politicians who promise to tax everyone else but you? You get hoisted by your own petard.
Related Posts:
- Senate Healthcare Bill is Also a Big Tax Increase Bill
- Online Tax Poll: Will President Obama Raise Taxes on the Middle Class?
- Obama Will Raise Taxes on the Middle Class, Financial Times Says
5 responses so far ↓
1 journey home // Feb 5, 2010 at 4:30 pm
“Use Senate reconciliation and expand Medicare via the Senate’s buy-in provisions. The CBO has already signed off on this as a means of saving money.
More importantly, if more Americans can do a buy-in with Medicare, it creates more cost control (because there’s a genuine “public option” competitor).
It also helps to solve the problems of pre-existing conditions, because Medicare does not deny coverage on this basis.
Allowing a Medicare buy-in to Americans under 65 would give people a genuine alternative to private insurance and thereby render the pre-existing question moot.
It would also lower Medicare costs by expanding the risk pool of patients (the great bulk of medical expenses are accounted for by a small number of people, mostly the elderly, requiring very expensive treatment).
And it would substantially enhance the global competitiveness of American corporations. After all, in what other country in the world is health care a marginal cost of production for business?” – Roosevelt Institute Marshall Auerback
2 Peter // Feb 5, 2010 at 7:23 pm
journey home,
I didn’t think reconciliation could be used for something like an overhaul of healthcare.
That other countries do something that we don’t doesn’t impress me. We defend the free world and they don’t.
3 Obamacare to Increase Taxes by $412 Billion // Feb 26, 2010 at 9:50 am
[...] You can call it a healthcare bill if you like, but it would be just as fair to call it a tax increase bill. [...]
4 Lora // Mar 11, 2010 at 10:12 pm
Peter,
You are my hero. You hit the nail on the head when you said that what other countries do does not impress you and that we defend the free while they don’t. Very well said.
5 Peter // Mar 11, 2010 at 10:29 pm
Lora,
Thank you and thanks for visiting.
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