Navigation Links
ATR: Obama Health Plan Is a Net Tax Hike of $629 Billion

Many of the Tax Hikes Fall on Families Making Less Than $250,000

WASHINGTON, Feb. 22 /PRNewswire-USNewswire/ -- Today, the White House released President Obama's draft healthcare plan. Below is a comprehensive analysis of all the tax provisions.  Where possible, scores have been assigned based on earlier versions of the legislation passed by the Senate, the President's budget, and (in the case of applying the Medicare tax to unearned income) ATR staff estimates based on IRS data (all scores are 10-year estimates):

*** Overall proposal is a net tax hike of $629 billion over 10 years ***

Title I (Net tax hike of $85 billion)

  • Same individual credit as Senate bill (-$102 billion)
  • Same small business credit as Senate bill (-$38 billion)
  • Reinsurance program ($121 billion)
  • Individual and employer insurance mandate penalties ($43 billion)
  • Associated effects on coverage provisions ($61 billion)

Title IX (Net tax hike of $544 billion)

  • Corporate 1099-MISC information reporting ($17 billion): Requires businesses to send 1099-MISC information tax forms to corporations (currently limited to individuals), a huge compliance burden for small employers
  • Black liquor credit repeal ($24 billion): This is an excise tax hike which is contained in the President's budget
  • Economic substance doctrine ($4 billion): This would require taxpayers to prove to the IRS that a perfectly-legal tax deduction or strategy is "economically substantial," and not simply a way to pay less in taxes
  • Medicare payroll tax hike ($87 billion): Increases Medicare payroll tax rate from 2.9 percent to 3.8 percent on wages and self-employment income which exceeds $200,000 ($250,000 married)
  • Apply Medicare tax to unearned income ($150 billion): Would apply this new, higher Medicare tax rate to unearned income (interest, dividends, rent, royalties, and passive investment in pass-throughs like S-corporations and partnerships--capital gains not mentioned)
  • Cadillac plan excise tax ($125 billion): 40 percent excise tax on health insurance plans to the extent they exceed $27,500 in cost for family plans, and $10,200 for single plans
  • Innovator medicine company tax ($22 billion): $2.3 billion annual tax on the industry imposed relative to share of sales made that year
  • Medical device manufacturer tax ($19 billion): $2 billion annual tax on the industry imposed relative to shares of sales made that year.  Exempts items retailing for <$100.  Rises to $3 billion annually in 2017
  • Health insurance company tax ($60 billion): $10 billion annual tax on the industry imposed relative to health insurance premiums collected that year.  Phases in gradually until 2017.  Fully-imposed on firms with $50 million in profits
  • Tanning tax ($3 billion): New 10% excise tax on indoor tanning salons
  • Increase HSA distribution penalty by 10 percentage points ($1 billion): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent
  • $2500 FSA cap a.k.a. special needs kiddie tax ($13 billion): Imposes cap on FSAs of $2500 (now unlimited).  Indexed to inflation after 2011
  • Employer-provided retiree Rx deduction repeal ($5 billion)
  • Medical itemized deduction "haircut" raised from 7.5 to 10 percent of AGI ($15 billion)
  • $500,000 executive compensation limit for health insurance companies ($1 billion)
  • Miscellaneous tax relief (-$2 billion)

Interestingly, the draft release from the White House seemingly lacks the following tax hikes which were contained in the Senate bill:

  • Employer reporting of insurance costs on W-2 (no revenue effect)
  • Excise tax on charitable hospitals (no revenue effect)
  • Blue Cross/Blue Shield tax hike ($400 million)
  • "Medicine cabinet tax" (limiting the purchase of non-Rx, over-the-counter medicines from HSAs, FSAs, and HRAs, $5 billion)

Americans for Tax Reform is a non-partisan coalition of taxpayers and taxpayer groups who oppose all tax increases.  For more information or to arrange an interview please contact John Kartch at (202) 785-0266 or by email at

SOURCE Americans for Tax Reform

Back to top
SOURCE Americans for Tax Reform
Copyright©2010 PR Newswire.
All rights reserved

Related medicine news :

1. Obama Pledges Major Expansion of AIDS and Global Poverty Programs
2. SEIU Members Endorse Sen. Barack Obama
3. Senior Obama Strategist David Axelrod and Wife Susan to be Honored for Their Decade-Long Commitment to Epilepsy Research at NYC Benefit
4. Debate Will Feature Clinton-Obama Positions on Health Care Followed by Straw Poll
5. National Union Hospital Healthcare Employees District 1199c Endorses Senator Obama
6. Physicians: McCains Health Care Plan More Realistic Than Obamas and Clintons
7. 5th Annual World Health Care Congress Kicks off April 21 With Obama, Clinton, McCain Health Care Policy Advisor Presidential Health Care Agenda Forum
8. Pharma Industry Group Favors Obama as Next President
9. Medical journal calls upon Barack Obama to do much more
10. OPEN LETTER: Medical Journal Calls Upon Barack Obama to Set the Record Straight on AIDS Virus
11. Statement from NARAL Pro-Choice Pennsylvania on NARAL Pro-Choice Americas Endorsement of Senator Barack Obama for President
Post Your Comments:
(Date:11/27/2015)... (PRWEB) , ... November 28, 2015 , ... There is ... we outperform our billings from last year? , This question has not been an ... are coming to the retirement age and the younger workforce don’t share the same ...
(Date:11/27/2015)... ... , ... According to an article published November 6th by The ... of British Columbia suggested that laws requiring bicyclists to wear helmets may not actually ... the reason for the controversial conclusion is that, while helmets have certainly prevented a ...
(Date:11/27/2015)... (PRWEB) , ... November 27, 2015 , ... ... affecting the health care in America. As people age, more care is needed, ... costs are rising, and medical professionals are being overworked. The forgotten part of ...
(Date:11/27/2015)... ... November 27, 2015 , ... An ... way to dispense prescription medications at home, so he invented the patent-pending ELECTRONIC ... and dispense prescription medications. In doing so, it could help to prevent potential ...
(Date:11/27/2015)... ... 27, 2015 , ... Lizzie’s Lice Pickers just announced a special promotion that ... of their purchase of lice treatment product. In addition, customers will receive a complimentary ... spokesperson. “Finding lice is a sure way to ruin the holidays, so we encourage ...
Breaking Medicine News(10 mins):
(Date:11/26/2015)... , 26 november 2015 AAIPharma ... de geplande investering aan van ten minste ... laboratoria en het mondiale hoofdkantoor in ... zal resulteren in extra kantoorruimte en extra ... de groeiende behoeften van de farmaceutische en ...
(Date:11/26/2015)... 2015 Research and Markets ( ) has ... Market Outlook to 2019 - Rise in Cardiac Disorders and ... report to their offering. Boston ... scientific and others. --> The ... Boston scientific and others. ...
(Date:11/26/2015)... , November 26, 2015 ... the addition of the  "2016 Future ... Global Cell Surface Testing Market: Supplier ... to their offering.  --> ... of the  "2016 Future Horizons and ...
Breaking Medicine Technology: