Tags: healthcare | taxes | obama | billions

Senate Healthcare Bill: $400B in New Taxes

By John Rossomando   |   Thursday, 24 Dec 2009 02:26 PM

Despite repeated promises that healthcare reform would not add “a single dime” to the taxes of the middle class, the massive Senate bill passed Thursday contains a variety of hidden taxes and tax hikes totaling at least $398 billion, according to experts.

National Review Online contributor Deroy Murdock wrote that the 2,457-page, $2.5 trillion healthcare package contains 12 new taxes and six tax hikes totaling $398 billion.

Americans for Tax Reform estimates seven of these tax hikes totaling $81.8 billion would violate the promises President Barack Obama made on the campaign trail last year. Obama said those making under $250,000 annually would not see their taxes raised by a “single dime.”

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Republican Idaho Sen. Mike Crapo introduced an amendment that would have eliminated all taxes affecting those making under $250,000, but the Democrats defeated it. Only five Democrats voted for it.

These taxes cover everything from indoor tanning salons to over-the-counter drugs.

The taxpayer advocate group estimates the tanning-salon tax could cost $2.7 billion. The $5 billion Medicine Cabinet tax would allow diabetics to purchase insulin, but would prohibit the use of money in Health Savings Accounts, Flexible Spending Accounts or Health Reimbursement Accounts from being used to purchase non-prescription, over-the-counter medications.

“While diabetics thankfully are spared, how does this benefit those who use antacids or asthma inhalers?” Murdock asked.

As of 2014, individual Americans without employer-provided health insurance would be hit with a $15 billion mandate to buy health insurance. Those without “qualifying” government-approved health coverage would have to pay $495 or 0.5 percent of Adjusted Gross Income, whichever is higher. In 2016, that number would rise to 2 percent of Adjusted Gross Income or $640.

Another $15.2-billion tax would require costs to reach 10 percent of Adjusted Gross Income, an increase from the current 7.5 percent before itemized medical expenses could be deducted.

Small businesses with 50 or fewer workers that decline to provide health insurance would face a $28 billion tax. Employers would be forced to pay a $750 fine on each of their 50 staffers if one staffer qualifies for a healthcare tax credit. That penalty would amount to $37,500 annually. Small business owners earning over $250,000 would suffer this same penalty.

Those with “Cadillac” healthcare plans valued at $8,500 for individuals and $23,000 for families face a potential 40 percent excise tax, or $149.1 billion in taxes.

“These taxes, the Congressional Budget Office predicts, “would be largely passed through to consumers in the form of higher premiums for private coverage,” Murdock wrote. “Also ─ in an affront before the law ─ longshoremen are exempt from this tax. Why not ship captains, or nurses, or test pilots?”

Murdock wrote the additional $59.6 billion tax on health insurance companies will also only serve to increase health insurance costs, while the $22.2 billion tax on drug companies would increase drug prices and reduce funds available for drug research.

Those in need of medical products such as hearing aids, heart stents, artificial limbs and other items aimed at improving their life quality would bear the brunt of a $19.2 billion medical products tax.

“Despite this massive picking of citizens’ empty pockets, Obamacare would still leave 24 million Americans uninsured,” Murdock wrote. “Among them, Reid claimed Monday, ‘On average, an American dies from lack of health insurance every 10 minutes.’

“If true, 210,384 Americans will drop dead waiting until 2014 for the start of Obamacare’s benefits, such as they are. Why profligate Democrats so desperate to do so little so slowly for so few?”

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