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)... ... November 27, 2015 , ... The print ... USA Today in Atlanta, Dallas, New York, Minneapolis, South Florida, with a circulation ... is distributed nationally, through a vast social media strategy and across a network ...
(Date:11/27/2015)... ... November 27, 2015 , ... Consistent ... sharing, the 2016 Building Better Radiology Marketing Programs meeting will showcase ... Sunday, March 6, 2016, at Caesars Palace in Las Vegas with a pre-conference ...
(Date:11/27/2015)... ... November 27, 2015 , ... The moment you stop improving ... only fulfilling the needs of advisers and clients but going above and beyond ... top-tier customer service. However, there's always room for improvement, which is why the ...
(Date:11/27/2015)... (PRWEB) , ... November 27, 2015 , ... ... the largest, most successful and prominent nonprofit healthcare organizations in the country. They ... involvement with various organizations, and helped advance the healthcare industry as a whole ...
(Date:11/27/2015)... ... November 27, 2015 , ... Indosoft ... announces the incorporation of Asterisk 11 LTS (Long Term Support) into its Q-Suite ... LTS brings Q-Suite 5.10 up-to-date with a version of Asterisk that will receive ...
Breaking Medicine News(10 mins):
(Date:11/27/2015)... UTRECHT , Niederlande, November 27, 2015 /PRNewswire/ ... mit fotodynamischer Bremachlorin-Therapie bei fortgeschrittenem Krebs.   ... fotodynamischer Bremachlorin-Therapie bei fortgeschrittenem Krebs.   --> ... fotodynamischer Bremachlorin-Therapie bei fortgeschrittenem Krebs.   ... berichtet. --> Clinical Cancer Research ...
(Date:11/26/2015)... Países Bajos, November 26, 2015 ... fotodinámica de Bremachlorin para el cáncer avanzado.   ... con la terapia fotodinámica de Bremachlorin para el cáncer ... enfoque combina la inmunoterapia con la terapia fotodinámica de ... Clinical Cancer Research . --> Clinical Cancer ...
(Date:11/26/2015)... -- Research and Markets ( ) has announced the ... to 2019 - Rise in Cardiac Disorders and Growing Awareness ... their offering. Boston scientific ... scientific and others. --> The market is ... Boston scientific and others. ...
Breaking Medicine Technology: