This is tax, tax, and tax bill and not healthcare reform.

The CATO Institute has analyzed the Senate’s health bill. And the institute’s conclusion, TAX, TAX, and more TAX but no reform.

SENATE HEALTH REFORM PLAN PRESCRIBES HEAVY TAX DOSE

Amid double-digit unemployment, a record $1.6 trillion federal deficit and a national debt projected to double in 10 years, the Senate voted to bring to the floor a health care overhaul that will kill jobs through its myriad tax increases, says Michael F. Cannon, director of health policy studies at the Cato Institute.

For starters, consider the $500 billion in explicit tax increases:

  • One levy would take $15 billion from sick patients with high out-of-pocket medical expenses, including elderly and low-income patients.
  • If you have a health savings account or flexible spending arrangement, there are taxes specific to those health plans, plus a third tax that would apply to all “consumer-directed” plans.
  • Another levy would tax medical devices, and another would tax prescription drugs; those two taxes would increase health insurance premiums by about 1 percent, according to the nonpartisan Congressional Budget Office.

Also:

  • There’s another $60 billion tax that would drive health premiums higher still; if your premiums climb high enough, you’ll become subject to a $149 billion tax on those with high health insurance premiums; yet many face high premiums simply because they have expensive medical needs, making this yet another tax on the sick.
  • The legislation would increase the Medicare tax on wages above $200,000, yet divert the revenue toward new entitlement spending.
  • And lest any corner of the health care sector go untaxed, the bill would even impose a 5 percent tax on cosmetic surgeries.

Yet those are just the explicit tax increases, says Cannon.  There are trillions of dollars in hidden tax increases, too.

The Senate health care bill would impose massive tax increases on Day One and keep increasing your taxes well into the future.  Let’s hope the ensuing Senate debate exposes why job-killing tax increases are the wrong prescription for health care reform, says Cannon.

Source: Michael F. Cannon, “Senate health reform plan prescribes heavy tax dose,” Omaha World-Herald, December 2, 2009.

For text:

http://www.omaha.com/article/20091202/NEWS0802/712029999

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4 Responses to This is tax, tax, and tax bill and not healthcare reform.

  1. Ben Hoffman says:

    We need some of those “job killing taxes” that Clinton and the Dems passed in the early 90s that preceded the enormous economy boom of the late 90s.

    • pjnoel says:

      Glad you chimed in, Ben Hoffman. Well, the economy did not tank when Clinton raised taxes in 1993 because the economy was in better condition than the current economic crisis. But there are evidences that the Clinton tax increase in 1993 and Bush tax increase in 1990 (to spur economic recovery) have cost Americans far more than the increase tax collected by the IRS. Compared the Reagan administration’s across the board tax cuts, the Clinton/Bush tax increases cost the economy to lose two years of growth. Here are the comparisons:

      – Real GDP grew more in five years under Reagan (23 percent cumulative growth) than it is projected to grow in seven years under Bush/Clinton (21 percent cumulative growth).

      – After four years, 4 million more jobs were created under Reagan than under Bush/Clinton.

      – Federal revenues, adjusted for inflation, grew much faster under Reagan (33 percent cumulative growth) than projected under Bush/Clinton (20 percent cumulative growth).

      – Real per capita disposable income grew more in two years under Reagan than in all four years combined thus far in the Bush/Clinton recovery (8.2 percent versus 7.8 percent).

      – Median family income grew in all of the first three recovery years under Reagan, compared to three consecutive declines under Bush/Clinton.

      In other words, during the economic expansion following Reagan’s tax cuts, the economy grew faster, experienced stronger revenue growth, created more jobs, and saw more rapid income growth than the current expansion under the high tax policies of Presidents Bush and Clinton.

      With the unemplyment at 10% and deficit sky high, do you think adding more government entitlements is the way to economic recovery?

      • Ben Hoffman says:

        There’s little evidence that Reagan’s tax cuts spurred growth. First of all, Reagan repealed a lot of his initial tax cuts in 1982 and then raised taxes almost every year. And why are you lumping Bush Sr. and Clinton together? We had a severe recession during Bush Sr.’s tenure. Of course that will bring down Clinton’s stats.

        Here’s Reagan’s tax history:
        1981 – the Economic Recovery Tax Act of 1981. The biggest tax cuts in U.S. history.
        1982 – The Tax Equity and Fiscal Responsibility Act of 1982. Repealed much of the tax cuts of 1981, raised unemployment taxes, doubled taxes on cigarettes, tripled taxes on telephone service.
        1982 – Highway Revenue Act of 1982 increased the gas tax through 1988
        1983 – Social Security Amendments of 1983. Increased Social Security taxes.
        1984 – Deficit Reduction Act of 1984. Increased taxes on exports and business expenses.
        1986 – Tax Reform Act (TRA) of 1986. Decreased individual taxes but increased corporate taxes.

      • pjnoel says:

        Tax Equity and Fiscal Responsibility Act of 1982
        • President of the United States Ronald Reagan agreed to the tax hikes on the promise from Congress of a $3 reduction in spending for every $1 increase in taxes
        • The original TEFRA bill as passed by the House (Republican Majority) lowered taxes
        • The Democratic-controlled Senate replaced the text of the original House bill with a number of tax increases (there was a lawsuit challenging the constitutionality of the bill but Supreme court ruled against it)

        Tax Reform Act 1986
        • The U.S. Congress passed the Tax Reform Act (TRA) of 1986, (Pub.L. 99-514, 100 Stat. 2085, enacted October 22, 1986) to simplify the income tax code, broaden the tax base and eliminate many tax shelters and other preferences. Referred to as the second of the two “Reagan tax cuts” (the Kemp-Roth Tax Cut of 1981 being the first), the bill was also officially sponsored by Democrats, Richard Gephardt of Missouri in the House of Representatives and Bill Bradley of New Jersey in the Senate.

        So Clinton’s low stats were because of Bush Sr, pathetic excuse.

        Is the current economic crisis because of Bush alone? The Democrats had been in control of both Houses of Congress since 2006. Did they do anything to stop funding the war or make sweeping changes to change the direction of the country? The answer is NO. Obama was a US Senator and he did nothing to stop all the mess that Bush did. That makes him have a certain degree of culpability in all this mess.

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