Obamacare Taxes: Deep Impact

Vivek Rajasekhar / April 15, 2010

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: (more…)