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  • Obamacare Taxes: Deep Impact

    During the 2008 presidential campaign, then-Senator Barack Obama pledged often and everywhere that Americans individuals making under $200,000 individually or families making under $250,000 would not see an increase in their taxes. However, by signing into law the Patient Protection and Affordable Care Act (PPACA) of 2010, President Barack Obama has officially turned his back on that promise. As the Heritage Foundation’s Senior Tax Policy Analyst Curtis Dubay points out, the impact of Obamacare on taxpayers will spread wide and cut deep. Overall, there are 18 new taxes slipped into this bill, raising $503 billion over a ten-year period to cement Democrats’ dubious claim of budget neutrality. Chief among these taxes are:

    • A 40 percent excise tax on health insurance plans
    • An increase in the Hospital Insurance (HI) portion of the payroll tax
    • Payroll taxes on investment
    • Mandates on individuals an businesses to purchase health insurance, enforced with penalties in the event of non-compliance

    In another move that smacks of politics as usual, Democrats have made sure these taxes and fees are not implemented until after their re-election campaigns. Almost all of these provisions take effect after the 2010 midterm elections, and the vast majority will not occur until after the 2012 presidential campaign, insulating President Obama and Congressional Democrats from the resulting political pressure. The greatest increase occurs in 2013, when Obamacare tax revenues triple from $12 billion to $36 billion, ultimately increasing to $102 billion per year in 2019. See a fuller list below:

    Many of the new taxes will be targeted at medical device manufacturers, pharmaceutical companies, health insurance companies, and even indoor tanning salons, all of which will be passed on to consumers in the form of higher prices.  Many large employers have already gone public on how these new taxes will effect them, citing job losses, decreases in offered benefits, or moving jobs overseas as the likely results.  Other provisions, such as restricting how much Americans can set aside in their health savings accounts and flexible savings accounts, will increase the amount paid in income taxes by low- and middle-income Americans.

    Enactment of the new health care law will prove a steep price to pay for taxpayers, even though Democrat legislators and the President have done their best to protect themselves from the electoral fallout. As Dubay explains:

    Over time, the hodgepodge of new taxes in effect now or in the future will substantially slow economic growth and affect taxpayers from all walks of life. This will become most apparent in lost wages and international competitiveness…

    These lost wages, largely out of the pockets of low- and middle-income families, represent a huge cost of this legislation that does not show up in any official tables, but this cost is every bit as real. It reduces families’ incomes just as surely as an income tax hike would and breaks the promise that President Obama made when he said he would not raise their taxes.

    Vivek Rajasekhar currently is a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/About/Internships-Young-Leaders/The-Heritage-Foundation-Internship-Program

    Posted in Ongoing Priorities [slideshow_deploy]

    16 Responses to Obamacare Taxes: Deep Impact

    1. donn loeffler says:

      Obama lied to every American with his slick talk! When one spends the way he has on all his pet projects and at the same time says that he won’t raise your taxes not even ” one dime”, surely it is too good to be true!. American voters were duped by this man, and for all the damage he has done in just 16 short months to our economic well being and that of our children and grandchildren, he should be impeached! What Nixon (Watergate) did, is relatively nothing compared to the hell that our country will go through in the next 5 to ten years! Jobs are still non existent,unemployed are having a hard time get help while congress plays their little games with their livelihood! We need a new leader, one who knows how to run a country and a congress who will respect the people they serve!

    2. Billie says:

      When are all Americans going to open their eyes to these deliberate acts of government take-over of the qualities and principles of human lives this country stands for?

    3. Jill, California says:

      Anyone paying attention during the campaign recognized that Obama's "promise" not to raise taxes was hogwash. All one had to do was look at his obscene spending during the campaign to know what was in store for the nation if he was elected. He "promised," via his actions, a future of obscene spending fueled by money raised any which way he could get it … and any which way he could label it. Taxes, fees, whatever. A pile of poop by any other name is still a pile of poop.

    4. Pete Stroempl of For says:

      "The power to tax is the power to destroy." (a quote from one of our Supreme Court justices many years ago.) This is a truth. Regardless of what good a person such a Mr. Obama believes he is creating.. that good is soiled and undermined by the act of theft that must be committed; that is.. theft through taxation.

    5. Shirley Sclafani, Ca says:

      Thank you for a great summary of the taxes we are facing. I think when the taxes start to kick in it will really get the sleeping public to take notice. Right now some still have their heads in the sand.

    6. Drew Page, IL says:

      One of my favorite movies is “Animal House”. And one of my favorite lines from that movie comes when Otter is consoling Flounder over the damage done to his brother’s new Lincoln Continental during a ‘road trip’, “Face it, you —-ed up, you trusted us.” I can just hear B.O., Pelosi and Reid repeating that line and laughing their heads off every time they hear of another complaint about health care reform.

      My advice to the American public, start drinking heavily.

    7. Bill - Forney, TX says:

      I didn’t see any additional taxes on lawyers who benefit from medical lawsuits but did not have to endure the pain and suffering to do so. How come lawyers don’t have any skin in the game? Legal costs are a very real part of medical costs and benefit that profession in a way similar to providers who actually provide a good or service for the consumer.

    8. loves Dogs/Colorado says:

      I'm watching a Hallmark show—lazy day finally. I'm watching this about a Beverly Hills widow who is saved by a homeless lady and thinking—why is this ONLY a movie. BeverlyHills, Hollywood etc all over this UNITED STATES OF AMERICA. Why aren't people helping people. Republicians need to get their heads out of their buns and stop BEING THE GOOD OL' BOY NETWORK IN WASHINGTON and start showing people out here that they REALLY do care about everyone instead of lining their pockets with money all the time and NOTdoing good for the people in this country. That's why everyone voted for the Idiots running this country right now. SAD A LOT of people in Washington need to STOP Playing games with everyones lives out here. Taxing everyone that is willing to work is WRONG. Encourage people, get them off welfare, let company's open up and make a profit and hirer people. Get them jobs——-NOT THE GOVERNMENT PAYROLL!!! People that have made it good and financially set—stop buying up houses all over the continent and start building shelters etc. and taking people in and helping them right here in the UNITED STATES. Stop letting illegals in because we AREN'T getting the cream of the corp! Owners of company's stop hiring them and start hiring the street people that speak ENGLISH and send everyone else home that's on a Visa——Encourge people out there. GET RID OF THE UNIONS!!! All Politicans need to be off the payrolls of these fat cats that DO NOTHING FOR OTHERS–the real people.

      And Obamas things of taxing people who make 250.000 up–ridiculous—it all depends on where you LIVE and what you do and how many kids you're trying to put thru college and not be on the tit of the GOVERNMENT—isn't that what democracy should be about??? NOT GETTING VOTES TO STAY IN POWER

      Get into the real things that life are about. HELPING REAL PEOPLE THAT ARE HURTING. You can't help everyone but you can try.

    9. Pingback: White House Admits Obamacare’s Individual Mandate is a Tax | Republican Party of Wood County

    10. Pingback: White House Admits Obamacare’s Individual Mandate is a Tax | Fix Health Care Policy

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    14. Judith A Rist says:

      is there a provision in Obama HCP that home sales after 1012 will be taxed to help pay for health care????

    15. June says:

      The mainstream media are responsible for the widespread ignorance about these tax issues. They avoid reporting the truth, and the gullible couch potatoes haven't a clue!!!!

    16. Danny says:

      All I'm going to say about this bill which generates revenue and originated in the Senate is Art. I Sect. 7 of the Constitution.

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