John Kartch
Will Obama Again Deny Healthcare Excise Tax is a Tax?
The Senate health care bill (S. 1796) indeed uses the term “excise tax” to describe the excise tax levied on Americans who do not purchase health insurance. If signed into law, the tax would break President Barack Obama’s “firm pledge” not to raise “any form” of taxes on families making less than $250,000 per year.
As seen on page 194 of the bill:
PART I—INDIVIDUAL RESPONSIBILITY
SEC. 1301. EXCISE TAX ON INDIVIDUALS WITHOUT ESSEN
TIAL HEALTH BENEFITS COVERAGE
Pages 195-196 describe the following:
“IMPOSITION OF TAX”
“INCLUSION WITH INCOME TAX RETURN”
“LIABILITY FOR TAX”
“AMOUNT OF TAX”
The excise tax is just one of several taxes in the bill that violate Obama’s tax pledge.
“Obama made a ‘firm pledge’ not to raise ‘any form’ of taxes on families making less than $250,000 per year,” said Grover Norquist, president of Americans for Tax Reform. “The Senate health care bill has a series of tax increases that would break this promise. It’s now time for Obama to tell the American people whether he lied his way into office or if he intends to govern as he campaigned.”
On Sept. 20, during an appearance on ABC’s This Week with George Stephanopoulos, Obama claimed that the excise tax in Senate Finance Committee Chairman Max Baucus’s (D-Mont.) draft bill would not break his tax pledge and denied that it is in fact a tax, even after Stephanopoulos read him the dictionary definition:
STEPHANOPOULOS: I -- I don't think I'm making it up. Merriam Webster's Dictionary: Tax -- "a charge, usually of money, imposed by authority on persons or property for public purposes."
OBAMA: George, the fact that you looked up Merriam's Dictionary, the definition of tax increase, indicates to me that you're stretching a little bit right now. Otherwise, you wouldn't have gone to the dictionary to check on the definition. I mean what...
STEPHANOPOULOS: Well, no, but...
OBAMA: ...what you're saying is...
STEPHANOPOULOS: I wanted to check for myself. But your critics say it is a tax increase.
OBAMA: My critics say everything is a tax increase. My critics say that I'm taking over every sector of the economy. You know that.
Look, we can have a legitimate debate about whether or not we're going to have an individual mandate or not, but...
STEPHANOPOULOS: But you reject that it's a tax increase?
OBAMA: I absolutely reject that notion. [Transcript]
More from Americans for Tax Reform
Obama Allies Continue Laying VAT Groundwork
Despite President Barack Obama’s “ firm pledge ” not to raise “ any form ” of taxes on families making less than $250,000 per year, the President’s advisors and Democratic allies continue to float the creation of a Value-Added Tax (VAT).
“It’s getting more and more obvious that President Obama and Democrats in Washington, D.C. are laying the groundwork for a VAT,” said ATR President Grover Norquist. “Apparently not content with violating his tax promise several times during the healthcare reform debate, President Obama now wants to tax every purchase made by every American—including those earning less than $250,000.”
The timeline below illustrates the gradual introduction of the VAT into public discussion:
May 27: Over the Memorial Day recess, the White House refuses to rule out a VAT:
“While we do not want to rule any credible idea in or out as we discuss the way forward with Congress, the VAT tax, in particular, is popular with academics but highly controversial with policymakers," said Kenneth Baer, a spokesman for White House Budget Director Peter Orszag. [Permalink]
June 16: House Ways and Means Committee Chairman Charlie Rangel (D-NY) floats a VAT to pay for health care.
“It’s a point of discussion. To say there’s any consensus would be misleading.” [Permalink]
July 9: Senate Finance Committee Democrats float new tax ideas for healthcare, including a 5% VAT.
August 2: Appearing on ABC’s This Week with George Stephanopoulos, Treasury Secretary Tim Geithner refuses to rule out a pledge-breaking tax hike after being given several opportunities to do so:
“I think what the country needs to do is understand we're going to have to do what it takes, we're going to do what's necessary.” [Transcript]
Meanwhile, on NBC’s Meet the Press, National Economic Council Director Larry Summers also refuses to rule out a tax hike:
“It is never a good idea to absolutely rule things out, no matter what.” [Permalink]
August 3, 2009: Questioned about the previous day’s comments by Geithner and Summers, White House Spokesman Robert Gibbs reiterates Obama’s tax pledge:
“I am reiterating the President's clear commitment in the clearest terms possible, that he's not raising taxes on those who make less than $250,000 a year.”[Transcript]
Sept. 25: John Podesta—head of President Obama’s transition team, floats the VAT on Bloomberg Television’s “Political Capital with Al Hunt.”
“There’s going to have to be revenue in this budget,” said Podesta,
A so-called consumption tax would “create a balance” with European and Japanese economies and “could potentially have a substantial effect on competitiveness,” said Podesta.
A so-called consumption tax would “create a balance” with European and Japanese economies and “could potentially have a substantial effect on competitiveness,” said Podesta.
Podesta said such a tax may be regressive, but can be balanced by exempting some products and using “the money to support low-wage workers.” [Permalink]
Sept. 29: Paul Volcker, former Fed Chairman, suggests a carbon tax and a VAT as a way to raise large amounts of revenue.
"Those are the two big ones. I'd love to see the expenditures held in check so we don't have to do that." [Permalink]
Sept. 30: The Center for American Progress—a group with White House ties—releases a draft report encouraging the Obama Administration to consider a VAT. The report concludes:
"In all seriousness, responsible people know that additional revenue has to be part of the mix even if they believe in lower taxes in general.” [Permalink]
The White House did not respond to a Wall Street Journal reporter’s requests for comment about the proposal.
Oct. 1: The Center for American Progress hosts a conference on national debt, where Roger Altman suggests a VAT could raise $400 billion for financial markets. [Permalink]
Oct. 2: At a forum sponsored by the Atlantic magazine and the Aspen Institute, Former Fed Chairman Alan Greenspan said a VAT should be considered to address deficits:
“I don’t like the value-added tax, but it’s the least worst way” to raise revenue. [Permalink]
Oct. 6: During on appearance on PBS’s The Charlie Rose Show, House Speaker Nancy Pelosi said a VAT is on the table:
“Somewhere along the way, a value-added tax plays into this. Of course, we want to take down the healthcare cost, that’s one part of it. But in the scheme of things, I think it’s fair to look at a value-added tax as well.” [Permalink]
Americans for Tax Reform maintains a Congressional “Anti-VAT Caucus.” It is comprised of 54 Congressmen and 4 Senators who are opposed to a value-added tax for America.
More from Americans for Tax Reform
2.7 Million Jobs Lost Since "Stimulus" Bill Enacted
The U.S. has lost at least 2.7 million jobs since President Barack Obama signed the “stimulus” package into law on Feb. 17.
In January, the Obama Administration claimed the $787 billion “stimulus” plan would lead to an unemployment rate of below 8 percent at this point in time. The unemployment rate now stands at 9.8 percent.
“I think my initial measure of success is creating or saving 4 million jobs,” said President Obama on February 9.
On Sept. 24, Biden told the nation’s governors: “In my wildest dreams, I never thought it [stimulus] would work this well.”
Monthly job losses reported by the BLS are as follows:
Mar: 652,000
Apr: 519,000
May: 303,000
June: 463,000
July: 304,000
Aug: 201,000 (preliminary)
Sept: 263,000 (preliminary)
Total: 2,705,000
“Obama’s overspending has made the economy worse, not better,” said Grover Norquist, Americans for Tax Reform.
Meanwhile, Vice President Joe Biden reacted to the jobs report by saying “As bad as things are, they would be far worse without the recovery plan or these other efforts.”
“Americans were forced to swallow the stimulus overspending, and it didn’t work,” said Norquist. “Is there anything the Obama Administration does that they will ever take responsibility for? Anything?”
More from Americans for Tax Reform
2.7 Million Jobs Lost Since "Stimulus" Enactment
Bureau of Labor Statistics report shows unemployment at 9.8%
The U.S. has lost at least 2.7 million jobs since President Barack Obama signed the “Stimulus” package into law on Feb. 17.
“I think my initial measure of success is creating or saving 4 million jobs,” said President Obama on February 9.
The unemployment rate now stands at 9.8 percent, up from 7.6 percent at the end of January.
Monthly job losses reported by the BLS are as follows:
Mar: 652,000
Apr: 519,000
May: 303,000
June: 463,000
July: 304,000
Aug: 201,000 (preliminary)
Sept: 263,000 (preliminary)
Total: 2,705,000
Apr: 519,000
May: 303,000
June: 463,000
July: 304,000
Aug: 201,000 (preliminary)
Sept: 263,000 (preliminary)
Total: 2,705,000
“President Obama demanded that Congress spend hundreds of billions of dollars to ‘stimulate’ the economy,” said Grover Norquist, president of Americans for Tax Reform. “Spend more money. Have fewer jobs. Let's stop this madness.”
Obama's $250,000 Tax Pledge Timeline:<br> Descending into a "Read My Lips" Betrayal
President Barack Obama’s central campaign promise was a “firm pledge” not to raise “any form” of taxes on families making less than $250,000 per year. This timeline of statements by Obama and White House staff and advisors illustrates a steady retreat from his oft-repeated promise to taxpayers:
Sept. 12, 2008: Obama makes a “firm pledge” not to raise “any form” of taxes on those making less than $250,000 per year:
“I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.” (Dover, NH) [Transcript] [Video clip]
April 1, 2009: After Obama broke his “firm pledge” when he signed into law a steep hike in the federal excise tax on tobacco, White House spokesman Reid H. Cherlin attempts to claim that the Obama pledge only applies to “income or payroll taxes”:
“The president's position throughout the campaign was that he would not raise income or payroll taxes on families making less than $250,000, and that's a promise he has kept.” (Associated Press interview) [Permalink]
April 15, 2009: During a White House press briefing, when challenged as to how Obama’s tax pledge squares with his tax hike on tobacco, White House spokesman Robert Gibbs replies:
“People make a decision to smoke.” [Transcript]
April 15, 2009: Moments later, when asked if Obama’s tax pledge applies “to the health care bill”, Gibbs replies:
“The statement didn’t come with caveats.” (White House Briefing) [Transcript]
June 28, 2009: When challenged on ABC’s This Week with George Stephanopoulos as to whether Obama’s tax pledge applies to healthcare reform, White House Advisor David Axelrod refuses three times to affirm the pledge and replies:
“One of the problems we've had in this town is that people draw lines in the sand and they stop talking to each other. And you don't get anything done.” [Transcript]
June 29, 2009: Questioned about David Axelrod’s comments made the day before, White House spokesman Robert Gibbs refuses seven opportunities to affirm Obama’s tax pledge, saying only:
“We're going to let the process work its way through. All right?” [Transcript]
August 2, 2009: Appearing on ABC’s This Week with George Stephanopoulos, Treasury Secretary Tim Geithner refuses to rule out a pledge-breaking tax hike after being given several opportunities to do so:
“I think what the country needs to do is understand we're going to have to do what it takes, we're going to do what's necessary.” [Transcript]
August 2, 2009: On NBC’s Meet the Press, National Economic Council Director Larry Summers also refuses to rule out a tax hike:
“It is never a good idea to absolutely rule things out, no matter what.” [Permalink]
August 3, 2009: Questioned about the previous day’s comments by Geithner and Summers, White House Spokesman Robert Gibbs reiterates Obama’s tax pledge:
“I am reiterating the President's clear commitment in the clearest terms possible, that he's not raising taxes on those who make less than $250,000 a year.”[Transcript]
Sept. 20, 2009: On ABC’s This Week with George Stephanopoulos, Obama claims that the Baucus plan’s excise tax on the uninsured would not break his tax pledge, denying that it is in fact a tax, even after Stephanopoulos reads him the dictionary definition:
STEPHANOPOULOS: I -- I don't think I'm making it up. Merriam Webster's Dictionary: Tax -- "a charge, usually of money, imposed by authority on persons or property for public purposes."
OBAMA: George, the fact that you looked up Merriam's Dictionary, the definition of tax increase, indicates to me that you're stretching a little bit right now. Otherwise, you wouldn't have gone to the dictionary to check on the definition. I mean what...
STEPHANOPOULOS: Well, no, but...
OBAMA: ...what you're saying is...
STEPHANOPOULOS: I wanted to check for myself. But your critics say it is a tax increase.
OBAMA: My critics say everything is a tax increase. My critics say that I'm taking over every sector of the economy. You know that.
Look, we can have a legitimate debate about whether or not we're going to have an individual mandate or not, but...
STEPHANOPOULOS: But you reject that it's a tax increase?
OBAMA: I absolutely reject that notion. [Transcript]
Click here for a PDF of this document
More from Americans for Tax Reform
Norquist statement on Baucus plan
Americans for Tax Reform president Grover Norquist issued the following statement today in response to the unveiling of the Baucus healthcare plan:
"The Baucus plan contains major new tax hikes on families, small businesses, employer-provided health insurance, and healthcare providers.
It will make healthcare more expensive, not less. It will lead to total government control of health insurance. It guts the only part of Medicare that provides competition and choice.
If a terminally optimistic person sees something good in the Baucus bill, we have to remember that it wouldn’t survive Nancy Pelosi’s House of Representatives.”
To read the list of taxes that ATR's Tax Policy Director Ryan Ellis has identified in the bill, click here.
More from Americans for Tax Reform
Baucus Healthcare Bill Violates Obama Tax Pledge
At least five tax hikes in the bill violate Obama’s central campaign promise not to raise “any form” of taxes on families making less than $250,000
The healthcare reform plan unveiled today by Senate Finance Committee Chairman Max Baucus (D-Mont.) contains at least five tax increases on families making less than $250,000 per year. Each provision would violate President Obama’s central campaign promise not to raise “any form” of taxes on these Americans. The tax increases include:
Individual Mandate Tax: Those who do not enroll in a health insurance plan would have to pay a new tax in the following range:
|
|
Single
|
Family
|
|
100-300% FPL
|
$750
|
$1500
|
|
300+% FPL
|
$900
|
$3800
|
Medicine Cabinet Tax: Americans will no longer be able to purchase over-the-counter medicines with their FSA, HSA, or HRA.
Backdoor Death of HSAs: By requiring that all plans (besides the few that are grandfathered) provide first-dollar coverage for most services, there would be no HSA-qualifying plans available from the Massachusetts-style exchanges.
Increase in Non-Qualified HSA Distribution Tax Penalty from 10 percent to 20 percent: This makes HSAs less attractive, and paves the way for HSA pre-verification.
A Cap on FSA Contributions at $2000: Currently unlimited.
More from Americans for Tax Reform
Let Them Eat Cake: White House Clueless on Taxpayer Rallies
Americans for Tax Reform (ATR) today released a timeline of White House statements dating from mid-April showing a consistent disdain toward Americans attending taxpayer rallies and town hall meetings:
April 14: Asked about the tax day “tea parties” being held the following day, Obama spokesman Robert Gibbs said: “I don't know if the President is aware of the events.”
April 19: Asked about the April 15 tea parties on Face the Nation, Obama senior advisor David Axelrod said: “I think any time you have severe economic conditions there is always an element of disaffection that can mutate into something that's unhealthy”
April 29: Speaking at a town hall meeting in St. Louis, Obama directly addressed tea party attendees: "Those of you who are watching certain news channels on which I'm not very popular, and you see folks waving tea bags around, let me just remind them that I am happy to have a serious conversation about how we are going to cut our health care costs down over the long term, how we are going to stabilize Social Security…But let's not play games and pretend that the reason [for the deficit] is because of the Recovery Act."
August 4: Asked by reporters about the growing concern expressed by town hall attendees, Gibbs said: “I hope people will take a jaundiced eye to what is clearly the Astro Turf nature of so-called grassroots lobbying”. Questioned further, Gibbs said: “This is manufactured anger”
Sept. 11: Asked about the planned taxpayer rallies taking place across the country the following day, Gibbs shrugged and told reporters: “I don't know who the group is”
Sept. 12: Taxpayers from all 50 states take part in the March on Washington, filling the streets from Freedom Plaza to the U.S. Capitol
Sept. 13: During an interview on Face the Nation, when asked what his message was to those at the previous day’s rallies, Axelrod said: “My message to them is they’re wrong”
More from Americans for Tax Reform
Obama's "Specific" Speech: Will He Disavow Pledge-Breaking Tax Hikes in House Dem Bill?
There are four tax hikes in the House Democrat healthcare bill (H.R. 3200) that violate President Obama's promise not to raise “any form” of taxes on families making less than $250,000 per year. The White House has told reporters that Obama is going to get specific on healthcare policy in a speech next week, which begs the question:
If Obama is serious about keeping his central campaign promise, will he disavow the four pledge-breaking provisions in the House Democrat healthcare bill? They are as follows:
Restrictions on tax-deductible purchases of over-the-counter medicines with health spending accounts like FSAs and HSAs. This isn’t in the original H.R. 3200, but it did make it into Charlie Rangel’s “Chairman’s Mark.” The description can be found at www.jct.gov, and it’s document JCX-32-09. The 8 million Americans who have a health savings account (HSA) and 30 million Americans who have a health flexible spending account (FSA) will no longer be able to buy over-the-counter medicines (aspirin, etc.) on a pre-tax basis. Contrary to the Obama rhetoric, this would change the plan people currently have, and raises their taxes in the process. This affects anyone with these types of accounts, not just those making more than $250,000 per year.
Tax on Individuals Not Enrolled in Health Insurance (Page 167): Those who don’t enroll in a health insurance plan will have to pay a new tax equal to 2.5% of income. If they earn $40,000 a year and don’t have health insurance, they will have to pay tax of $1000. Notice how this tax affects all individuals, not just those making more than $250,000 per year.
Tax on Businesses Not Offering Health Insurance (Page 183): If a business has a payroll of at least $500,000 and does not offer health insurance, it will be compelled to pay a new payroll tax of 8 percent. It doesn’t matter if the business is profitable or running a loss. Small businesses pay taxes on their owners’ 1040s. This will affect thousands of small businesses with profits of less than $250,000 per year.
IRS Can Disallow Perfectly Legal Tax Deductions They Just Don’t Like (Page 207): If a taxpayer (including one making less than $250,000 per year) uses a perfectly-legal tax deduction the IRS doesn’t like, the IRS will be empowered to simply disallow it. The only reason the IRS has to give is that the tax break lacks “economic substance”—that is, the taxpayer is not taking the deduction for “substantial” or “business” reasons. For those wanting to engage in a legal activity to cut their tax bill, the IRS wins no matter what.
Tax on Individuals Not Enrolled in Health Insurance (Page 167): Those who don’t enroll in a health insurance plan will have to pay a new tax equal to 2.5% of income. If they earn $40,000 a year and don’t have health insurance, they will have to pay tax of $1000. Notice how this tax affects all individuals, not just those making more than $250,000 per year.
Tax on Businesses Not Offering Health Insurance (Page 183): If a business has a payroll of at least $500,000 and does not offer health insurance, it will be compelled to pay a new payroll tax of 8 percent. It doesn’t matter if the business is profitable or running a loss. Small businesses pay taxes on their owners’ 1040s. This will affect thousands of small businesses with profits of less than $250,000 per year.
IRS Can Disallow Perfectly Legal Tax Deductions They Just Don’t Like (Page 207): If a taxpayer (including one making less than $250,000 per year) uses a perfectly-legal tax deduction the IRS doesn’t like, the IRS will be empowered to simply disallow it. The only reason the IRS has to give is that the tax break lacks “economic substance”—that is, the taxpayer is not taking the deduction for “substantial” or “business” reasons. For those wanting to engage in a legal activity to cut their tax bill, the IRS wins no matter what.
More from Americans for Tax Reform
Team Obama's Operation "Soften Up the People for a Tax Hike" Continues
Statements made Sunday by Treasury Secretary Tim Geithner and National Economic Council Director Larry Summers indicate President Barack Obama is poised to (again) break his central campaign promise not to raise “any form” of taxes on Americans making less than $250,000 per year. The comments are the latest of a string of statements by Obama’s spokesmen and appointees gradually stepping back from the “firm pledge” made during the campaign.
Appearing on ABC’s This Week with George Stephanopoulos, Geithner would not rule out a pledge-breaking tax hike after being given several opportunities to do so. “I think what the country needs to do is understand we're going to have to do what it takes, we're going to do what's necessary.”
Meanwhile, on CBS's Face the Nation, Summers also refused to rule out a tax hike: “It is never a good idea to absolutely rule things out, no matter what,” he said.
“Obama should fire Geithner and Summers,” said Grover Norquist, president of Americans for Tax Reform. “Two appointees of President Obama went on national television and implied the president lied his way into office and that he is open to raising taxes.”
“To have the president’s own appointees accuse him of lying his way into office is a betrayal beyond words,” continued Norquist. “If, however, Obama has been silent in reaction to these two statements, he does intend to raise taxes, and he should resign because he lied his way into office by making a promise he had no intention of keeping.”
During the campaign, Obama made a “firm pledge” not to raise “any form” of taxes on those making less than $250,000 per year:
“I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”(Dover, NH) [Transcript] [Video clip]
“George H.W. Bush made a similar promise,” said Norquist. “He broke that promise and was fired by the American people.”
Click here for a PDF of the release.
Pages
State news
Top Stories
