Americans for Tax Reform President Grover Norquist sent the following letter today to Senate Republican Leader Mitch McConnell (R-Ky.):
This week, the United States Senate will vote to repeal the laws which have come to be known as “Obamacare.” This is one of the most important votes of this Congress. Americans for Tax Reform will keyvote in favor of Obamacare repeal in our annual Congressional scorecard.
Obamacare is one of the largest tax hikes in American history. While many rightly decry Obamacare as a government healthcare bill (and it is), it’s also a gargantuan tax hike. There are nearly $600 billion in new or higher taxes in the first decade of the law’s implementation, and about $1 trillion in the second decade. In all, there are nearly two dozen new or higher taxes in Obamacare, the most notorious being the individual mandate.
Because Obamacare is a large tax hike, repealing Obamacare is likely to be the largest tax cut passed out of the Senate this Congress. Obamacare is a bill that will cost American jobs, and one of the biggest reasons why is all the new taxes. Getting these tax increases out of the pipeline will increase employer certainty and allow money to stay in the hands of job creators, not Washington bureaucrats.
Some tax hikes have already taken effect, and need to be repealed immediately. Obamacare is phased in over several years, and some provisions (including tax hikes) have already taken effect. The 10 percent tax on tanning salons went into effect last July. Starting this past January, American families found that they no longer were allowed to use their FSAs or HSAs to purchase non-prescription, over-the-counter medicines using these pre-tax accounts. People forced in these difficult economic times to withdraw from their HSAs for non-medical reasons saw their “surtax” rise from 10 to 20 percent, creating effective tax rates on this emergency choice of as high as 60 percent. The IRS is now allowed to disallow perfectly-legal tax deductions because they claim the write-offs lack “economic substance.”
Some tax hikes will soon take effect, and Obamacare needs to be repealed before they do. Had it not been for IRS intervention, employers this year would have to track the cost of providing health insurance for their employees, and report this cost on W-2 tax forms. Instead, this setup for a future tax hike will happen next year. Also starting in 2012, small employers will have to issue 1099-MISC information reporting forms to any person or company with whom they do at least $600 in business over the course of the year. Even the IRS says they can’t handle the flood of paper-filed 1099s that will result.
I would urge all Senators who support taxpayers to support the repeal of Obamacare.