ATR Urges Support for Davis-Cohen Airport Tax Amendment to House FAA Bill

Share on Facebook
Tweet this Story
Pin this Image

Posted by Justin Sykes on Monday, June 26th, 2017, 10:08 AM PERMALINK

Americans for Tax Reform this week released a letter to House Transportation and Infastructure Committee members urging support for the bipartisan amendment being offered by Representative Rodney Davis (R-IL) and Representative Steve Cohen (D-TN) to the House FAA reauthorization bill (H.R. 2997).

The Davis-Cohen amendment would correct a long-standing issue with how revenue from the assessmenet of taxes, fees, and charges upon businesses located at commercial service airports is used. The problem the Davis-Cohen amendment would address is that often revenue generated from taxes and fees levied at commercial service airports is diverted and used for non-aviation purposes outside of the airport. 

The amendment being offered as part of the House's FAA reauthorization bill would resolve this issue by ensuring revenue from any tax, fee, or charge levied upon any business located at a commercial service airport remains at the airport and is used solely for aviation purposes. 

The full text of the letter is below and can also be found here

June 26, 2017

Dear Chairman Shuster, Ranking Member DeFazio, Chairman LoBiondo and Ranking Member Larsen:

Americans for Tax Reform (ATR) urges your support for the bipartisan amendment being offered by Representative Rodney Davis (R-IL) and Representative Steve Cohen (D-TN) to the House FAA reauthorization bill, H.R. 2997. 

The Davis-Cohen amendment offers a common sense solution to issues surrounding the manner in which revenue from the assessment of taxes, fees, and charges upon businesses located at commercial service airports is used.

It is often the case that revenue generated from taxes and fees levied at commercial service airports is diverted and used for non-aviation related purposes outside of the airport. This diversion of revenue generated at airports is wholly inequitable and deprives America’s airports of revenue that should be used solely for aviation related projects and infrastructure. 

The FAA Authorization Act of 1994 attempted to address this issue however local and state governments have utilized a loophole in the 1994 Act as it applies to the “exclusivity” requirement where such taxes may be imposed if a single business outside of the airport is also subject to the tax.

The amendment being offered by Representatives Davis and Cohen would resolve this issue, by ensuring that revenue from any tax, fee, or charge levied upon any business located at a commercial service airport remains at the airport and is used solely for aviation related purposes.

Americans for Tax Reform urges House Transportation and Infrastructure Committee members to support inclusion of the Davis-Cohen Airport Tax amendment in the House FAA reauthorization bill. 

Sincerely,                                   

Grover G. Norquist                                                         
President                                                                       
Americans for Tax Reform

 

Photo credit: Phil Roeder

More from Americans for Tax Reform


ATR Supports Representative Johnson's "No Bonuses for Tax Delinquent IRS Employees" Act

Share on Facebook
Tweet this Story
Pin this Image

Posted by Virginia Birkofer on Monday, June 26th, 2017, 8:00 AM PERMALINK

The Treasury Inspector General for Tax Administration found in a 2014 report that the IRS is giving out bonuses to employees with outstanding tax obligations. This is not a hypothetical concern, the report found that the IRS has handed out over $1 million in bonuses, 10,000 hours in extra time off, and 69 step increase to more than 1,100 employees with tax problems. This report highlights the IRS’s continued misuse of funds, prompting the need for immediate reform within the agency.

These IRS employees are failing to comply with the very laws they were hired to enforce. The IRS and its employees cannot continue to be treated as above the law. To hold IRS employees to the same standards American taxpayers are obligated to follow, Representative Sam Johnson (R-TX) has proposed H.R. 1599, The “No Bonuses for Tax Delinquent IRS Employees Act.”

This legislation will prohibit the IRS from providing bonuses or other performance related award to IRS employees that have outstanding federal tax debt. In a show of support, ATR wrote to Congressman Johnson, stressing the importance of this legislation to all members of congress to ensure the IRS is held accountable to the American people.

The full letter can be found here and is pasted below:

June 20, 2017

The Honorable Sam Johnson
United States House of Representatives
2304 Rayburn House Office Building
Washington, D.C. 20515

Dear Congressman Johnson:

I write in support of H.R. 1599, the “No Bonuses For Tax Delinquent IRS Employees Act.” This legislation prohibits the Commissioner of the Internal Revenue Service from providing bonuses or other performance related award to IRS employees that have outstanding federal tax debt.

The concern that the IRS is giving bonuses to tax delinquent employees is not hypothetical. The agency has handed out over $1 million in bonuses, 10,000 hours in extra time off, and 69 step increases to more than 1,100 employees with tax problems, according to a 2014 report by the Treasury Inspector General for Tax Administration.

These employees are failing to comply with the very laws they were hired to enforce. Taxpayers are expected to comply with federal law, and it is only reasonable to expect IRS employees to be held accountable to the same standard.

In recent years, the IRS has claimed it does not have enough taxpayer resources to properly do its job. At the same time, the agency has been found to have committed numerous improper activities, most notably when the IRS Exempt Organization Division led by Lois Lerner targeted non-profit conservative groups. This is just one of many instance the IRS has failed to do its job and there is clear need for reform within the agency.

Supporting the No Bonuses For Tax Delinquent IRS Employees Act is a matter principle. The simple fact is, IRS employees who are failing to comply with the tax laws they are employed to enforce should be held accountable. Members of Congress should support this important legislation and ensure the IRS is held accountable to the American people.

Onward,

Grover G. Norquist

President, Americans for Tax Reform

 

 

Photo Credit: 
Photo in the Public Domain, link: https://www.flickr.com/photos/congressman-sam-johnson/4990298810/in/dateposted/

More from Americans for Tax Reform


Seattle Gun Tax Results? Violence Goes Up While City Hides Tax Revenue Data

Share on Facebook
Tweet this Story
Pin this Image

Posted by Elizabeth McKee on Friday, June 23rd, 2017, 1:42 PM PERMALINK

Seattle shootings have increased by 30% since the imposition of a city-wide gun tax, according to local news station KOMO TV. In August 2015, the Seattle city council imposed a $25 tax on firearms and a 5 cent tax on ammunition.

As reported by KOMO:

The city has seen a 17 percent increase in the number of police calls about shots fired compared with last year. Thirty-five people have been shot in Seattle so far this year -- a 30 percent increase.

The city refuses to disclose how much revenue the gun tax has generated, saying only that it has raised “less than $200,000.” Before its passage, the city claimed the tax would squeeze $300,000 to $500,000 from citizens purchasing guns.

As reported by Fox News, the tax revenue amount could be much lower:

Seattle officials refuse to say how much the tax brought in the first year, only giving the number “under $200,000.” Gun rights groups have sued to get the exact amount.

But Mike Coombs, owner of Outdoor Emporium, the last large gun dealer left in Seattle, said the actual tax revenue is almost certainly just over $100,000, a figure based on information he says the city shared with his lawyers.

Coombs said storewide, sales are down 20 percent while gun sales have plummeted 60 percent.

“I’ve had to lay off employees because of this,” Coombs said. “It’s hurting us, it’s hurting our employees.”

The hefty taxes are driving gun shop owners out of the city. One businessman, Sergey Solyanik, was forced to close his shop and move 18 miles away to Lynnwood, Washington. Solyanik told local news website MyNorthwest, “In fact, there will be a net loss for this city. This location brings in roughly $50,000 in sales tax revenue, so that is all going to be gone next year. And there is not going to be any revenue from the (gun) tax.”

“The Left is now weaponizing tax policy in its drive to destroy the Second Amendment rights of all Americans,” said Grover Norquist, president of Americans for Tax Reform.

The Northern Mariana Islands, a U.S. commonwealth, previously enacted a $1,000 gun tax, but a federal judge struck down the provision. The judge ruled, “The government need not arm the poor, but it cannot impose uncommon burdens on their ability to exercise their fundamental constitutional rights.”

As pointed out by Americans for Tax Reform throughout the 2016 presidential campaign, Hillary Clinton endorsed a 25% national gun tax. “I'm all for that. I just don't know what else we're going to do to try to figure out how to get some handle on this violence,” she said in testimony to the Senate Finance Committee in 1993. In June 2016 ABC’s George Stephanopoulos played the video of her endorsement and ask for her response. Clinton refused to disavow her gun tax endorsement.

The Seattle gun tax not only infringes upon Americans’ Second Amendment rights, it shows the futility of the progressive left’s view of taxation.

 

Photo credit: Andrew Malone

More from Americans for Tax Reform


Treasury Report Lays Plans for Financial Regulatory Reform

Share on Facebook
Tweet this Story
Pin this Image

Posted by Adam Johnson on Friday, June 23rd, 2017, 9:15 AM PERMALINK

President Donald Trump signed Executive Order 13772 on February 2, 2017 in order to lay out core principles for regulators when creating regulations within the U.S. financial system. This order was an important step to streamlining the overly burdensome regulatory regime that has plagued the economic recovery after the Great Recession.

The Core Principles that President Trump listed out in the Executive Order are as follows:

  1. Empower Americans to make independent financial decisions and informed choices in the marketplace, save for retirement, and build individual wealth;
  2. Prevent taxpayer-funded bailouts;
  3. Foster economic growth and vibrant financial markets through more rigorous regulatory impact analysis that addresses systemic risk and market failures, such as moral hazard and information asymmetry;
  4. Enable American companies to be competitive with foreign firms in domestic and foreign markets;
  5. Advance American interests in international financial regulatory negotiations and meetings;
  6. Make regulation efficient, effective, and appropriately tailored; and
  7. Restore public accountability within Federal financial regulatory agencies and rationalize the Federal financial regulatory framework.


Within the order, President Trump requested the Secretary of Treasury, Steven Mnuchin, to give a report to the President on the extent to which current regulations, laws, guidance, and more, promote the Core Principles or inhibit them, along with subsequent reports.

This June Secretary Mnuchin released the first of many reports on the financial system’s regulatory burdens. The report covered the U.S. depository sector, which includes banks, savings associations, and credit unions. The Secretary mentions that it is of critical importance for banking regulation to align with the Core Principles. Therefore, the Secretary’s report lists out nine recommendations for regulatory reform within the depository system:

Addressing the U.S. Regulatory Structure: The current structure within the U.S. regulatory system is filled with duplication, overlap, and fragmentation, which can lead to ambiguity and repetitive regulations. This report suggests a number of changes to the function and structure of regulatory agencies in order to have greater coordination and to avoid regulatory overlap.

Refining Capital, Liquidity, and Leverage Standards: There is a heavy burden created by Dodd-Frank on banks when it comes to statutory stress testing. This report suggests raising the threshold of what is considered to be a big bank in order to ease these burdens.

Providing Credit to Fund Consumers and Businesses to Drive Economic Growth: The current regulatory burden has contributed to limited credit being passed onto consumers, which inhibits economic growth. The Treasury recommends increasing banks’ capacities to lend and their abilities to design and deliver lending products while maintaining safety standards.

Improving Market Liquidity: The many regulations implemented through Dodd-Frank have been limiting market liquidity within the banking system. By enacting significant changes to these regulations, including the Volcker Rule, the report suggests that it would support economic growth, avoid systemic risk, and minimize the risk of a taxpayer-bailout.

Allowing Community Banks and Credit Unions to Thrive: Ever since Dodd-Frank law was signed into law, community banks and credit unions have been burdened significantly with an average of one institution being shuttered daily. The report suggests exempting banks with assets under $10 billion from a number of regulatory provisions in order to ease this burden.

Advancing American Interests and Global Competitiveness: Many international regulatory standards create an unfriendly environment for banks of any size and form within the U.S. The Treasury suggests that all international standards imposed on U.S. banking agencies be reviewed in order to minimize negative economic consequences.

Improving the Regulatory Engagement Model:  With a lack of coordination and communication between governmental agencies and boards of banking organizations, there has been a decrease in effectiveness of regulations. A greater degree of inter-agency cooperation with themselves and boards of directors would allow for more transparency and accountability.

Enhancing Use of Regulatory Cost-Benefit Analysis: While Congress has imposed strict cost-benefit analysis requirements on regulatory agencies, the requirements are not uniform and consistent among the different agencies. Therefore, by adopting a more consistent and transparent cost-benefit analysis of regulations, there will be less confusion within the banking system.

Encouraging Foreign Investment in the U.S. Banking System: Foreign direct investment is an excellent way to diversify risk and expand economic growth. The report suggests increasing these investments in order to broaden international corporate investment in our banking system.

Photo Credit: Stephen Jaffe

 


PA Gov. Wants to Bring Back the “Tech Tax”

Share on Facebook
Tweet this Story
Pin this Image

Posted by Caroline Sayers on Thursday, June 22nd, 2017, 4:11 PM PERMALINK

Governor Tom Wolf wants to bring back the job-killing “tech tax.”

In more detail, this proposal – included in his 2017-2018 budget – would eliminate the sales and use tax exemptions in place for computer services and other industries, extending the 6 percent state rate and various local rates to data processing, hosting, and related services; custom computer programming services; computer system design services; and computer facilities management services.

Gov. Wolf’s proposed “tech tax” would not only put Pennsylvania in the same outlier category as the four states that currently tax such services, it would also make the Keystone State’s the most burdensome. Estimated to bring in about $349 million each year, the Governor Wolf’s “tech tax” would inflict a great deal of harm on taxpayers, consumers, and the state economy.

Pennsylvania has become a hub for technology businesses thanks, in large part, to its repeal of a similar “tech tax” six years ago through bipartisan effort. The Pittsburgh Technology Council found that 302,535 individuals in southwestern Pennsylvania are employed in the tech industry, making up 24 percent of the area’s workforce. But bringing back the “tech tax,” however, would put this sector of Pennsylvania’s economy at risk.

If the “tech tax” were brought back, businesses in Pennsylvania may be forced to offset the associated compliance costs by cutting wages, laying off employees or even moving to other states (Relocation is not hard for tech companies because they often have mobile business models). In that vein, the “tech tax” would also push business owners and selectors looking for a new place to launch or expand their operations away from Pennsylvania, as it suggests that lawmakers in the state care more about new ways to burden them with taxes than actually helping them grow. 

Along with chilling business growth and investment, the “tech tax” would have more immediate negative consequences in store for the people of Pennsylvania, as business would likely push at least part of the financial burden onto consumers.

Gov. Wolf’s tech tax would stifle a vibrant part of Pennsylvania’s economy. Overall, the tax would be detrimental to the people and businesses of Pennsylvania. If the legislators really care about their constituents they will reject this tech tax and prove that Pennsylvania is both pro-business and pro-growth. 

Photo Credit: 
Governor Tom Wolf

More from Americans for Tax Reform


ATR Applauds House FAA Bill for Not Including PFC Increase

Share on Facebook
Tweet this Story
Pin this Image

Posted by Justin Sykes on Thursday, June 22nd, 2017, 12:28 PM PERMALINK

This week the House Transportation and Infrastructure Committee, Chaired by Representative Bill Shuster (R-Penn.), released their version of a bill to reauthorize the Federal Aviation Administration (FAA). 

Americans for Tax Reform (ATR) applauds Chairman Shuster and the Committee for not including provisions that would increase or uncap the Passenger Facility Charge (PFC).   

The PFC program allows for the collection of PFC fees for enplaned passengers at commercial airports controlled by public agencies. Airports use revenue generated from PFC fees to fund airport improvement projects that are approved by the FAA.

Currently the PFC is capped at $4.50 and maintaining the PFC at this level is a benefit to the traveling public. Given the current levels of revenue and PFC collections at airports, it is entirely possible for airports to continue making improvements without increasing the cost of flying for passengers.

According to FAA reports, U.S. airports brought in a record $27 billion in 2015 alone including record highs of $10.7 billion from airline rents and fees and $9.1 billion from non-airline revenues such as retail and food and beverage.

For 2016 PFC collections hit a new record high of over $3.1 billion according to FAA data, averaging roughly $260 million a month. FAA projections for 2017 show an additional increase of over $3.36 billion in estimated PFC collections. It is also the case that the Airport and Airway Trust Fund has reached its highest levels since 2001 with an uncommitted balance of over $6 billion. 

Government taxes and fees already overburden airline passengers – taxes make up over 20% of the cost of an average domestic flight. Given the record levels of airport revenue, billions in cash on hand, and PFC collections, there is simply no need to subject the traveling public to increased costs.

While Americans for Tax Reform looks forward to working with lawmakers on other provisions of the FAA reauthorization bill, the Committee's work to ensure that wholly unnecessary increases to the PFC are not included in the reauthorization bill is a positive step to benefit the traveling public. 

 

Photo credit: Jeff Slinker    

More from Americans for Tax Reform


Senate Bill Abolishes Obamacare’s Middle Class Taxes

Share on Facebook
Tweet this Story
Pin this Image

Posted by Alex Hendrie on Thursday, June 22nd, 2017, 10:52 AM PERMALINK

The Senate’s Obamacare repeal bill abolishes the many middle class taxes that were imposed by President Obama and the Democrat party in 2010. Obama promised repeatedly that he would never raise any form of tax on any household making less than $250,000 per year.

He lied.

Although you’ll never hear it from the establishment media, the Senate’s Obamacare repeal bill:

  • Abolishes the Obamacare Individual Mandate Tax which hits 8 million Americans each year.
  • Abolishes the Obamacare Employer Mandate Tax.
  • Abolishes Obamacare’s Medicine Cabinet Tax which hits the 20 million Americans with Health Savings Accounts and the 30 million Americans with Flexible Spending Accounts.
  • Abolishes Obamacare’s Flexible Spending Account tax on 30 million Americans.
  • Abolishes Obamacare’s Chronic Care Tax on 10 million Americans with high out of pocket medical expenses. This Obamacare tax imposed higher income taxes on households making an average of $53,000 per year.
  • Abolishes Obamacare’s HSA withdrawal tax.
  • Abolishes Obamacare’s 10% excise tax on small businesses with indoor tanning services.
  • Abolishes the Obamacare health insurance tax.
  • Abolishes the Obamacare 3.8% surtax on investment income.
  • Abolishes the Obamacare medical device tax.
  • Abolishes the Obamacare tax on prescription medicine.
  • Abolishes the Obamacare tax on retiree prescription drug coverage.
     

“Obamacare promised to reduce individual insurance premiums – a lot. Premiums rose – a lot,” said Grover Norquist, president of Americans for Tax Reform. Obama promised no tax hikes on anyone earning less than $250,000 – that was a lie. Taxes increased. Healthcare costs increased. Obamacare failed. By its own promised goals, it failed. It is time to repeal failure and reform healthcare to protect consumers, not bureaucracy.”

Photo credit: Sam Bowman

More from Americans for Tax Reform


Tax Reform Brings out the Good and Bad in Key States

Share on Facebook
Tweet this Story
Pin this Image

Posted by Americans for Tax Reform on Thursday, June 22nd, 2017, 10:47 AM PERMALINK

With 50 laboratories of democracy in the U.S., some state legislatures provide examples of smart pro-growth policies that other states would be wise to emulate, while others serve as bad examples by enacting policies that other states should avoid.

Taxachusetts Lawmakers Help The Commonwealth Earns Its Nickname

The past week has underscored this dynamic, in particular when it comes to income tax reform. In Massachusetts, state lawmakers referred a measure to the 2018 ballot that, if enacted, would move the state from having a flat income tax, to a progressive structure with income over $1,000,000 subject to a 4% surtax on top of the commonwealth’s existing 5.10% flat income tax rate. Meanwhile, in North Carolina, Republicans who run the state senate and assembly announced a budget deal that will reduce personal and corporate income tax rates.

Maryland, which enacted a similar millionaires’ tax when Gov. Martin O’Malley was governor, provides a cautionary tale highlighting why Massachusetts voters should reject the surtax that will appear on their 2018 statewide ballot. A year after Maryland’s millionaire’s tax took effect, one-third of the state’s millionaires fled the state. A 2011 study, of migration patterns across the 50 states concluded that millionaires tend to leave states with high income tax rates for states with relatively lower income taxes. Enactment of a millionaires’ tax would be bad news for Massachusetts, but great news for neighboring New Hampshire, one the nine states that does not levy and income tax*.

19,600 Massachusetts tax filers would be affected by the tax increase, 900 of whom are projected to make $10 million annually and would contribute 53 percent of the revenues from the new tax. If just one-third of these 900 tax-filers left, the tax revenue lost would be about $750 million. It is not just the wealthy who would be hit by this tax hike. According to IRS data, over 10,000 Massachusetts small businesses would also be hit by this tax hike, since the majority of small businesses file under the individual income tax system.

The Beacon Hill Institute found that the surtax could cost the state more than 9,000 private sector jobs and $405 million in disposable income. While income tax hikes on the wealthy are often popular with voters, the fact is that the millionaires’ tax will hit small businesses with a 78% income tax rate hike, greatly reducing their job-creating capacity.  

In addition to making the Bay State less attractive to investment and job creators, Increased reliance on upper-income households will make Massachusetts’ revenues less stable, and budgeting more difficult. This is because increasing the progressivity of the tax code leads to greater volatility in revenue collections. One of the worst parts of this proposal is that, if it’s enacted by voters in 2018, there will be no way to amend it until the year 2023. So, if the tax ends up damaging the economy and chasing individuals, families, and employers out of state, like such tax hikes have in other states, lawmakers and voters will have to wait half a decade before they are able to rectify the problem.  

Tax Reform Train Rolls on in the Tar Heel State

Days after Massachusetts lawmakers voted to advance a massive income tax hike, North Carolina legislators announced a budget agreement that will take the Tar Heel State in the other direction by enacting another round of cuts to the personal and corporate income tax rates. Though the house and the senate rolled out similar plans with a $22.9 billion budget, there are some key differences between the proposals and how the budget is spent.

The budget deal announced by legislative leaders makes the following tax changes, which would take effect January 1, 2019:

  • Cuts the state’s flat personal income tax rate from 5.499% to 5.35%
  • Reduces the corporate tax rate from 3% to 2.5%
  • Increased the standard deduction for married couples filing jointly from $17,500 to $20,000

The budget with these reforms will pass both chambers of the legislature this week. Though the budget includes many of Gov. Roy Cooper’s (D) priorities, it is unlikely he will sign this budget into law. Fortunately for North Carolina taxpayers, Republicans hold veto-proof majorities in both chambers of the legislature, and can enact this budget over Gov. Cooper’s objection.

In a year where 31 states are facing revenue shortfalls, North Carolina has a half a billion dollar surplus. In fact, this marks the third straight year that the state has realized a budget surplus.

These surpluses have occurred at the same time North Carolina lawmakers have approved multiple rounds of personal and corporate income tax rate cuts. In addition to the pro-growth tax changes enacted, the key to North Carolina’s fiscal and economic success has been spending restraint. Every year since Republicans took control of the state legislature, spending growth has been held before the rate of population growth and inflation. When it comes to models for pro-growth tax reform and spending restraint, other states and federal officials should look to the Tar Heel State for inspiration, and Massachusetts as an example of what not to do.    

Photo Credit: 
Murduck Rubbaduckie

More from Americans for Tax Reform


Norquist: Georgia Victory Shows that Voters Support Tax Reform


Posted by Elizabeth McKee on Wednesday, June 21st, 2017, 4:00 PM PERMALINK

Americans for Tax Reform president Grover Norquist appeared on Fox Business Network’s Mornings with Maria to discuss Speaker Ryan’s speech at the National Association of Manufacturers. Norquist affirmed that Republican electoral victories in Georgia and South Carolina will help Congress to pass tax reform by the end of the year:
 
Ryan’s talk yesterday was extremely important, but with the victories in the Georgia special election and the South Carolina special election, there was a huge exclamation mark on that speech because Ryan said, ‘here’s what we’re going to do,’ and then right behind him was the political strength to help make that easier to do.
 
According to Norquist, the House, Senate, and White House are largely unified on the key pillars of tax reform - including cutting the corporate rate. “They’re meeting regularly,” he reported. “They’re going to come up with a unified plan.”
 
“Every Republican is largely for every one of the tax cuts that’s being discussed,” said Norquist. “The only question is how many can fit in the box.”
 
Norquist noted that passing tax reform will help Republicans maintain their political momentum and continue to win elections in 2018. “Get this done and make it dramatically pro-growth. That’s the most important thing you can do if you want to get yourself re-elected.”
 
Victorious Republican Karen Handel signed the Taxpayer Protection Pledge, a written commitment to the taxpayers of Georgia to oppose tax increases. Democrat Jon Ossoff refused to sign the Pledge, leaving the door open to a tax hike if he had won. But he did not win at all.
 
Watch the full video here.

More from Americans for Tax Reform


Obamacare’s Health Insurance Tax Should Be Repealed Effective Immediately

Share on Facebook
Tweet this Story
Pin this Image

Posted by Alexander Hendrie on Wednesday, June 21st, 2017, 2:00 PM PERMALINK

The U.S. Senate is moving forward with repeal of Obamacare, including the nearly 20 new or higher taxes that the law imposed.

These taxes directly hit middle class families and small businesses, raise the cost of healthcare, and reduce access to care. Repealing these taxes is a huge win for taxpayers across the country. 

It is expected that the Senate will phase in the repeal of these taxes over multiple years. Most Obamacare taxes are currently in effect, and relief should be offered as quickly as possible.  

Immediate repeal of the Obamacare health insurance tax is crucial because it is set to go into effect in 2018. Letting this tax go into effect next year and then repealing it at a later date will cause the cost of insurance to climb. Moreover, it will result in unnecessary complexity for middle class families and small businesses.

This tax is levied on insurance premiums, so its costs are inevitably passed to middle class families and small businesses that provide healthcare to their employees. In addition, the tax impacts the care received by seniors through Medicare advantage coverage and low-income Americans who rely on Medicaid managed care.

As a result, allowing the health insurance tax to go into effect will have significant economic consequences. Next year alone, the tax will total $12.3 billion. Over the next decade, the health insurance tax totals $145 billion.

Immediate repeal means strong tax relief for middle and low-income families. According to the American Action Forum, the tax increases premiums by as much as $5,000 over a decade. In total, the tax hits 11 million households that purchase through the individual insurance market, and 23 million households covered through their jobs. Roughly half of the tax is paid by those earning less than $50,000 a year.

In addition, the tax is devastating to small businesses. It is estimated to directly impact as many as 1.7 million small businesses. The National Federation of Independent Business estimates the tax could cost up to 286,000 in new jobs and cost small businesses $33 billion in lost sales by 2023.

Small businesses account for half of all jobs in the US and two-thirds of new jobs in recent decades, so this tax will mean businesses across the country can spend less on investing in new equipment, hiring new workers, or providing higher wages.

American families have already been hit hard by Obamacare’s tax increases. The law imposed multiple taxes that have increased the cost of care for families and reduced choice, including taxes on Health Savings Accounts and Flexible Spending Accounts.

The last thing taxpayers need is for the health insurance tax to go into effect, even for one year. Conversely, permanent and immediate repeal of the health insurance tax is a huge win for Americans and will help decrease the cost of care for millions across the country. 

Photo Credit: 
https://www.flickr.com/photos/pictures-of-money/

More from Americans for Tax Reform


hidden
×