In the publication of this article, I attempted to find comments by President Obama related to individual taxes or costs as associated with the health care bill (especially taxes). I was looking for assurances from the President that my taxes would not increase as a result of the health care overhaul. What I found was a list of new taxes.
1) A new 10% excise tax on tanning. That’s going to be a real job creator and a help to small business.
2) Beginning in 2011, companies must provide a valuation for their employees’ individual health care on each employee’s W-2 form. Why would your health care plan be on your W-2? What is your W-2 used for? Taxes!
3) Increasing the penalty to 20% for unqualified deductions from health care savings accounts. On a personal note, I refused to participate in a health savings account this past year because the money had to be used by a certain period of time or it was lost (or withdrawn at penalty). This is a totally absurd method to encourage people to save for health care expenses, especially healthy people who may experience “shocks.” The government is also capping the amount that can be contributed to this account. How is this supposed to encourage health care savings?
4) Deductions on medical care expenses for people 65 and under will be raised from expenses over 7.5% of income to 10% of income. Who is this going to hurt? It will hurt the very working people who have medical problems and struggle with insurance and health care costs. This is the equivalent of a tax increase on them and an increase in their out-of-pocket costs.
5) If you don’t obtain adequate health coverage by 2016, you will face a fine of $695 or 2.5% of income, whichever is greater. Don’t worry, as the government will determine what “adequate” health coverage is.
6) A refundable tax credit for those who have health insurance and whose incomes are less than 4 times the poverty level. I wonder who is going to finance this, especially in the next recession when tax revenues fall and a greater number of families qualify for this credit (due to the drop in wages)?
7) Businesses will pay $2,000 per employee per year if they do not provide adequate insurance. This penalty is not included for the first 30 employees. How many small businesses under 200 people are going to provide health insurance after this law goes into effect? What will your business do if they determine it is cheaper to “send you to the health insurance exchange?”
8) In addition to these, Paul Volcker recently announced that a national sales tax will be necessary to raise funds for the federal budget problems.
While it has not been confirmed that other sin taxes (cigarettes, alcohol, junk foods) will be added to finance the bill, these areas should be watched for new taxes.
Do you have any additional health care tax stories to share? Did you find video or quotations of President Obama assuring the American people their taxes would not increase?