Obamacare Tanning Tax Reaches One Year Mark
Today marks the one year anniversary of the implementation of the Obamacare indoor tanning tax. The punitive 10 percent tax was among the first of twenty-one Obamacare tax hikes to take effect, and is just one of the seven Obamacare tax hikes that break President Obama’s “firm pledge” that no family making less than $250,000 per year would see “any form of tax increase.”
Taken together, the full slate of Obamacare tax hikes constitute one of the largest tax increases in American history – more than $500 billion over ten years. On April 14, the first of these tax hikes was repealed: The 1099 small business paperwork tax. This Obamacare tax would have required every business in America to issue a “1099” tax form to every office supply store, gas station, restaurant, etc. from which they bought at least $600 in goods and services throughout the year.
Congressman Michael Grimm (R-N.Y.) and Senator Olympia Snowe (R-Maine) have introduced legislation to repeal the indoor tanning tax (H.R. 2092 and S. 1298, respectively).
Below is the full list of Obamacare tax hikes, their implementation dates, and page numbers in the legislation where the tax hikes can be found:
(REPEALED) 1. Corporate 1099-MISC Information Reporting (Tax hike of $17.1 bil/takes effect Jan. 2012): Requires businesses to send 1099-MISC information tax forms to corporations (currently limited to individuals), a huge compliance burden for small employers. Bill: PPACA; Page: 1,960-1,961
2. Individual Mandate Excise Tax (takes effect in Jan 2014): Starting in 2014, anyone not buying “qualifying” health insurance must pay an income surtax according to the higher of the following
|
1 Adult |
2 Adults |
3+ Adults |
2014 |
1% AGI/$95 |
1% AGI/$190 |
1% AGI/$285 |
2015 |
2% AGI/$325 |
2% AGI/$650 |
2% AGI/$975 |
2016 + |
2.5% AGI/$695 |
2.5% AGI/$1390 |
2.5% AGI/$2085 |
Exemptions for religious objectors, undocumented immigrants, prisoners, those earning less than the poverty line, members of Indian tribes, and hardship cases (determined by HHS). Bill: PPACA; Page: 317-337
3. Employer Mandate Tax (takes effect Jan. 2014): If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees. Applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer). Bill: PPACA; Page: 345-346
Combined score of individual and employer mandate tax penalty: $65 billion/10 years
4. Surtax on Investment Income (Tax hike of $123 billion/takes effect Jan. 2013): Creation of a new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single). This would result in the following top tax rates on investment income: Bill: Reconciliation Act; Page: 87-93
|
Capital Gains |
Dividends |
Other* |
2011-2012 |
15% |
15% |
35% |
2013+ (current law) |
23.8% |
43.4% |
43.4% |
2013+ (Obama budget) |
23.8% |
23.8% |
43.4% |
*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations. It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income. It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans. The 3.8% surtax does not apply to non-resident aliens.
5. Excise Tax on Comprehensive Health Insurance Plans (Tax hike of $32 bil/takes effect Jan. 2018): Starting in 2018, new 40 percent excise tax on “Cadillac” health insurance plans ($10,200 single/$27,500 family). Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions. CPI +1 percentage point indexed. Bill: PPACA; Page: 1,941-1,956
6. Hike in Medicare Payroll Tax (Tax hike of $86.8 bil/takes effect Jan. 2013): Current law and changes:
|
First $200,000 |
All Remaining Wages |
Current Law |
1.45%/1.45% |
1.45%/1.45% |
Obamacare Tax Hike |
1.45%/1.45% |
1.45%/2.35% |
Bill: PPACA, Reconciliation Act; Page: 2000-2003; 87-93
7. Medicine Cabinet Tax (Tax hike of $5 bil/took effect Jan. 2011): Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). Bill: PPACA; Page: 1,957-1,959
8. HSA Withdrawal Tax Hike (Tax hike of $1.4 bil/took effect Jan. 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent. Bill: PPACA; Page: 1,959
9. Flexible Spending Account Cap – aka “Special Needs Kids Tax” (Tax hike of $13 bil/takes effect Jan. 2013): Imposes cap on FSAs of $2500 (now unlimited). Indexed to inflation after 2013. There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. Bill: PPACA; Page: 2,388-2,389
10. Tax on Medical Device Manufacturers (Tax hike of $20 bil/takes effect Jan. 2013): Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax. Exempts items retailing for <$100. Bill: PPACA; Page: 1,980-1,986
11. Raise "Haircut" for Medical Itemized Deduction from 7.5% to 10% of AGI (Tax hike of $15.2 bil/takes effect Jan. 2013): Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI). The new provision imposes a threshold of 10 percent of AGI. Waived for 65+ taxpayers in 2013-2016 only. Bill: PPACA; Page: 1,994-1,995
12. Tax on Indoor Tanning Services (Tax hike of $2.7 billion/took effect July 2010): New 10 percent excise tax on Americans using indoor tanning salons. Bill: PPACA; Page: 2,397-2,399
13. Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D (Tax hike of $4.5 bil/takes effect Jan. 2013) Bill: PPACA; Page: 1,994
14. Blue Cross/Blue Shield Tax Hike (Tax hike of $0.4 bil/took effect Jan. 1 2010): The special tax deduction in current law for Blue Cross/Blue Shield companies would only be allowed if 85 percent or more of premium revenues are spent on clinical services. Bill: PPACA; Page: 2,004
15. Excise Tax on Charitable Hospitals (Min$/took effect immediately): $50,000 per hospital if they fail to meet new "community health assessment needs," "financial assistance," and "billing and collection" rules set by HHS. Bill: PPACA; Page: 1,961-1,971
16. Tax on Innovator Drug Companies (Tax hike of $22.2 bil/took effect Jan. 2010): $2.3 billion annual tax on the industry imposed relative to share of sales made that year. Bill: PPACA; Page: 1,971-1,980
17. Tax on Health Insurers (Tax hike of $60.1 bil/takes effect Jan. 2014): Annual tax on the industry imposed relative to health insurance premiums collected that year. Phases in gradually until 2018. Fully-imposed on firms with $50 million in profits. Bill: PPACA; Page: 1,986-1,993
18. $500,000 Annual Executive Compensation Limit for Health Insurance Executives (Tax hike of $0.6 bil/takes effect Jan 2013). Bill: PPACA; Page: 1,995-2,000
19. Employer Reporting of Insurance on W-2 ($min/takes effect Jan. 2012): Preamble to taxing health benefits on individual tax returns. Bill: PPACA; Page: 1,957
20. “Black liquor” tax hike (Tax hike of $23.6 billion/took effect immediately). This is a tax increase on a type of bio-fuel. Bill: Reconciliation Act; Page: 105
21. Codification of the “economic substance doctrine” (Tax hike of $4.5 billion/took effect immediately). This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed. Bill: Reconciliation Act; Page: 108-113
More from Americans for Tax Reform
List of Tax Hikes Supported by Virginia Candidate for Lieutenant Governor Glenn Davis

In the heavily contested race for the Republican nomination for Lieutenant Governor this year in Virginia, voters should beware: Delegate Glenn Davis has a history of voting to raise taxes and grow government.
Here are just a few of the billions of dollars in tax hikes he has supported during his time as a Delegate to the General Assembly and City Council-member:
Sales Tax Hikes
Six Percent Sales Tax Increase Statewide (HB 2313, 2013);
Twenty Percent Sales Tax Increase in Northern Virginia and Hampton Roads (HB 2313, 2013);
Gas Tax Hikes
Statewide Gas Tax Increase (HB 2313, 2013);
Targeted Hampton Roads Gas Tax Increase (HB 2313, 2013);
Targeted Central Virginia Gas Tax Increase (HB1541, 2020)
Real Estate Tax Hikes
Northern Virginia Real Estate Recording Tax Increase (HB 2313, 2013);
Virginia Beach Real Estate Tax Increase (Virginia Beach's 2013 City Budget);
Hampton Roads Grantors Tax Increase (HB1726, 2020)
Hotel Tax Hikes
Two Percent Hotel Occupancy Tax Increase (HB 2313, 2013);
Car Tax Hikes
Car Titling Tax Increase from 3 to 4.14 Percent (HB 2313, 2013);
Personal Property Tax Increase on Cars from $3.70 to $3.80 per $100 of Value (James Spore, Resource Management Plan, 2010);
New Internet Taxes
New Tax on Internet Purchases (HB 1501, 2017);
Davis filed legislation in 2017 to tax internet sales, a move that could have raised taxes by more than $250 million a year (Fiscal Impact Statement, Department of Taxation).
But wait, there's more. Delegate Glenn Davis supported Obamacare expansion in Virginia. When his colleagues were rejecting the misguided expansion of Medicaid for able-bodied adults, Davis was penning op-eds and spending his time arguing, "We take the money, or it goes someplace else."
Delegate Glenn Davis is not a mainstream conservative. He's out of touch with the real needs of taxpayers.
Unlike Winsome Sears and Tim Hugo, also contenders for Lieutenant Governor, Davis refuses to sign the Taxpayer Protection Pledge, a written commitment to you, Virginia voters, to oppose even more tax increases. Can taxpayers trust Davis as Lieutenant Governor? On May 8th, they'll have the chance to decide.
Norquist on WaPo Explains the Importance of a Competitive Corporate Tax Rate

ATR President Grover Norquist joined Jacqueline Alemany on Washington Post Live to discuss President Biden’s proposed tax increases and his more than $4 trillion infrastructure plan.
During this conversation, Norquist discussed the success of lowering the corporate income tax rate in the Tax Cuts and Jobs Act, which led to the lowest unemployment rate in 50 years, immense economic growth, and a substantial rise in the median income.
Norquist explains how lowering the corporate income tax rate helped lower the unemployment rate to historic levels:
"When the Republicans cut taxes, we took the highest corporate rate in the world, 35 percent, all the rest of the world had lowered their corporate rates below 35 percent and they were getting stronger economic growth as a result. We were still at 35 percent, 10 points higher than communist China. What happened when the Republicans cut individual rates, rates on small business, rates on corporations?
We went to the lowest unemployment in 50 years, 3.5 percent; this is 2019. We went to the lowest poverty rate in 50 years. Everything that the liberals said they want to do with big spending programs was actually achieved. The bottom quarter earners got larger raises than the top quarter earners in the economy."
Norquist explains how the Tax Cuts and Jobs Act spurred economic growth and raised wages:
"So, for everything from equity to jobs to creation, compare it to the rest of the world. The U.S. growth in 2018 was 2.9 percent; that was twice Germany's, which was 1.5 percent; more than twice Britain's.
We were not only out-competing--in one year, one year alone, 2019, the median income, which is the median income, family income, half people make less, half the people make more. Bill Gates making a billion dollars doesn't move the median. The median income, in that one year alone, increased 6.8 percent, or $4,440; $4,000 raise for the median income. That means tens of millions of Americans saw their income increase by those amounts. That compares to, oh, during the Obama years, in eight years, Obama increased it 5 percent. In one year, the lower rates in 2019 increased the median income 6.8 percent, or over $4,000. By the way, almost exactly what the Republican economists in the White House predicted would happen if you cut taxes and more capital, more investment per worker flooded in."
Norquist explains how Biden's tax hikes will harm Americans' 401(k) accounts:
"But think about the owners of capital, if you have a 401(k), your 401(k) will be worth less because it's a higher corporate rate, and 53 percent of American households have a 401(k); 53 percent of Americans do not make more than $400,000 a year. Biden is going right for the middle class, right for the upper middle-class and that 400,000 is a dead letter and never amount to anything, and certainly doesn't mean anything now."
Click below to watch:
Iowans Will Get Stuck with Higher Utility Bills Due to Biden Corporate Tax Rate Hike

If Biden and the Democrats enact a corporate income tax rate increase, they will have to explain why they just increased your utility bills
If President Biden and congressional Democrats hike the corporate income tax rate, Iowa households and businesses will get stuck with higher utility bills. Democrats plan to impose a corporate income tax rate increase to 28%, even higher than communist China's 25%.
Customers bear the cost of corporate income taxes imposed on utility companies. Corporate income tax cuts drive utility rates down, corporate income tax hikes drive utility rates up.
Electric, gas, and water companies must get their billing rates approved by the respective state utility commissions. When the 2017 Tax Cuts and Jobs Act cut the corporate income tax rate from 35% to 21%, utility companies worked with officials to pass along the tax savings to customers, including at least four Iowa utilities.
Working with the Iowa Utilities Board, Iowa American Water Co., MidAmerican Energy Company, Black Hills Energy and Alliant Energy passed along tax savings to customers.
Alliant Energy: As noted in this April 13, 2018 DEI excerpt:
Alliant Energy announced this week that it will pass savings from lower federal taxes on to its customers in Iowa.
Annual savings, including tax-related savings from Alliant Energy’s transmission providers, are expected to be approximately $75 million, the company said.
“These tax savings are great for our Iowa customers and the new, lower corporate tax rate will benefit our families, businesses and communities today and in the future,” Doug Kopp, president of Alliant Energy’s Iowa energy company, said. “In the last six years, we’ve delivered about $500 million in other separate tax-related savings to customers, reducing energy costs.”
Typical residential electric customers will see an annual savings of approximately $50 to $60. Typical residential natural gas customers will see annual savings of approximately $30
Iowa American Water Co.: As noted in this Jan. 29, 2018 Des Moines Register article excerpt:
And Iowa-American Water Co., which provides service in eastern Iowa, would provide $1.5 million and $1.8 million to customers.
MidAmerican Energy Company: As noted in this April 5, 2018, Quad-City Times excerpt:
"A big part of the tax reform is the corporate income tax rate changing from 35 to 21 percent," said MidAmerican spokeswoman Tina Hoffman. "That is what the $42 million represents, with 100 percent going back to the customers."
The company expects to distribute $33 million on electrical bills and $8.8 million on natural gas bills. The total also includes annual savings for commercial and industrial consumers: $75 in electricity, $25 in natural gas for commercial customers and $8,000 in electricity, $175 in natural gas costs for industrial customers, she said.
In addition, Hoffman said MidAmerican expects to save another $40 million to $50 million in 2018 from other tax-related benefits including new provisions related to how companies account for excess accumulated deferred taxes and depreciation. The utility plans to create an account to capture these benefits and use them to reduce the size or need for a future rate case in Iowa.
Black Hills Energy: As noted in this April 27, 2018 Iowa Utilities Board statement:
The Iowa Utilities Board issued multiple orders this week approving an estimated $78.7 million in savings for utility customers based on the IUB’s investigation and review of the tax refund proposals filed with the IUB by MidAmerican Energy, Alliant Energy-Interstate Power and Light, and Black Hills Energy regarding the 2017 federal tax reform law.
The IUB opened an investigation into the impact of the federal Tax Cut and Jobs Act of 2017 on Iowa’s rate-regulated utilities in January 2018, Docket No. INU-2018-0001. The utilities’ tax refund proposals detailing how customers would benefit are a result of this investigation. The new tax law reduced the federal corporate income tax rate from 35 percent to 21 percent.
The following tax refund proposal tariffs were approved by the IUB, subject to complaint or investigation:
Black Hills Energy will return an estimated $2.2 million to its natural gas customers in Docket No. TF-2018-0037.
Conversely, a vote for a corporate income tax rate hike is a vote for higher utility bills as households recover from the pandemic.
Many small businesses operate on tight margins and can't afford higher heating, cooling, gas, and refrigeration costs. President Biden should withdraw his tax increases.
International Reference Pricing Would Harm American Patients, Workers, and the Healthcare System

President Joe Biden is expected to release a “human infrastructure” plan in the coming weeks that spends as much as $2 trillion. This proposal will likely include new tax increases and foreign price controls on American medicines that will harm patients, manufacturers, and the American healthcare system.
House Democrat lawmakers want to include H.R. 3, “the Lower Drug Costs Now Act,” legislation they pushed last Congress that would impose international reference pricing. This policy will set U.S. prices based off the prices in six countries - Australia, Canada, the United Kingdom, France, Germany, and Japan. These price controls are enforced by a 95 percent excise tax on medicines.
If included into the Biden infrastructure plan, international reference pricing would lead to healthcare shortages, threaten American jobs, and crush medical innovation.
Foreign countries have significant healthcare shortages. These countries utilize socialist price controls on their healthcare systems. Because there is no way to compete on price, supply is reduced, which means reduced access to care for citizens in these countries.
For instance, Canadian patients wait an average of 19.8 weeks from referral to treatment. By comparison, 77 percent of Americans are treated within four weeks of referral, while just 6 percent wait more than two months.
At any one time. one million Canadians are waiting for treatment according to some estimates.
In the UK, there was a shortage of 10,000 doctors and 43,000 nurses in 2019, with 9 in 10 managers in the National Health Service saying that too few doctors and nurses presented a danger to patients. At any one time, 4.5 million patients were waiting to see a doctor or receive care.
France has been forced to make significant spending cuts to its “free” socialist healthcare system and there have been significant shortages of basic supplies. Australia has also experienced problems with shortages of medicines, and healthcare professionals.
Adopting foreign price controls will create the same problems that foreign healthcare systems suffer from. It will lead to less medical innovation leading to fewer cures and healthcare shortages for American patients.
According to research by the Galen Institute, 290 new medical substances were launched worldwide between 2011 and 2018. The U.S. had access to 90 percent of these cures, a rate far greater than comparable foreign countries. By comparison, the United Kingdom had access to 60 percent of medicines, Japan had 50 percent, and Canada had just 44 percent.
Price controls utilized by Europe delayed new drugs coming to market by an average of 14 months.
Reference pricing will threaten the development of new medicines. As it stands, developing new medicines is a time consuming and expensive process, as noted by the Congressional Budget Office. It takes up to $2 billion and ten years to develop new medicines and only 12 percent of drugs that enter clinical trials ultimately make it onto the market. Manufacturers make this steep investment knowing they will be able to recoup the extensive costs involved.
Costs for developing new medicines includes laboratory research and clinical trials of drugs as well as expenditures on medicines that that do not make it past these stages. The clinical development and approval times alone average 90.3 months for a pharmaceutical drug and 97.3 months for a biologic.
Because of the steep investments required, research and development spending averaged 25 percent of net pharmaceutical revenues in 2018 and 2019, totaling roughly $80 billion each year.
Not only does this investment make the U.S. a world leader in medical innovation, but it also ensures we have high paying manufacturing jobs. Nationwide, the pharmaceutical industry directly or indirectly accounts for over four million jobs across the U.S and in every state, according to research by TEconomy Partners, LLC. This includes 800,000 direct jobs, 1.4 million indirect jobs, and 1.8 million induced jobs, which include retail and service jobs that are supported by spending from pharmaceutical workers and suppliers.
The average annual wage of a pharmaceutical employee in 2017 was $126,587, which is more than double the average private sector wage of $60,000. President Biden has repeatedly promised to create millions of new high paying manufacturing jobs in America. He must ensure that his policies do not cause the loss of existing jobs.
Adopting foreign price controls through an international reference pricing plan would harm American patients, workers, and the healthcare system. This policy has no place in Biden’s infrastructure bill and should be rejected by lawmakers.
Photo Credit: Darko Stojanovic
Poland’s Digital Advertising Tax is a Mistake

Poland is moving in the wrong direction on taxes. In February the government decided -- against longstanding principles of international taxation -- to impose new taxes on digital advertising. This new levy, from 5% to 10% on digital ads, will affect the private digital media market in favor of the state-run pro-government media. This is a clear anti-market policy that will affect foreign direct investment and increase bias public spending.
In Poland, substantially raising tax revenue from private digital media businesses will enable the government to spend more on state media. For example:
- Television, radio, and cinema companies whose annual advertising revenue is between PLN 1,000,000 ($262,692 USD) and PLN 50,000,000 ($13,134,585 USD) will pay a 7.5% tax. Companies with higher advertising revenue will pay 10%.
- Newspapers reporting advertising revenue between PLN 15,000,000 ($3,940,375 USD) and PLN 30,000,000 ($7,880,751 USD) will pay a 2% tax, while newspapers earning more will pay 6%.
- A 5% tax on Internet advertising will be placed on any company exceeding EUR 5,000,000 ($5,955,250 USD) of advertising revenue.
When plans to impose a new tax were announced, almost all private media went on strike, suspending publication of any content. Although the strike lasted only one day, it was the first time since 1989 that the media in Poland––often of different ideological orientations––united in this way and on such a large scale.
An American bad example: Maryland
In the United States, starting on March 14, Maryland was the first state to impose a digital advertising tax. Republican Governor Larry Hogan vetoed this bill in May 2020. The bill violates the Internet Tax Freedom Act, but the Maryland Senate, run by Democrats, ignored the Governor’s decision, as well as fierce opposition from many legal scholars and overrode the veto. This bill imposes a tax on digital advertising with a tax rate span from 2.5% to 10% which is applied to a company’s global annual gross revenue from digital advertising services in Maryland. The cost of the digital advertising service tax will ultimately be borne by Maryland-based employers and consumers in the form of higher prices and fewer options for advertising services, as companies that utilize online platforms will pass the added costs on to consumers. This will not come as a surprise, as companies like Amazon and Google had to adjust prices in response to similar measures in France, Spain, and other countries. This tax will be paid by people and not by the companies the government is targeting. The Maryland DST will not only affect the economy in the state but also undermine the powerful opposition of the USA's global position against digital service taxes.
A European bad example: Austria
But much closer to Poland, in Europe, is the Austrian digital advertisement tax. Despite the initial commitment to wait for and find a solution during the ongoing OECD negotiations, Austria implemented a digital advertisement tax of 5% on digital advertising on revenue, effective on January 1st, 2020. This levy is applied to all companies that reach or exceed an annual global revenue of 750 million Euro and annual revenue of 25 million Euro or more on digital advertising services. By nature of the design of the scope of the tax, only American tech companies are subject to it. It is the most advanced unilateral attempt by a European government to target U.S. digital corporations such as Google, Amazon, Facebook, and Apple. As consequence, the United States Trade Representative (USTR) launched an investigation into Austria's digital advertisement tax and concluded it was discriminatory against American companies.
New taxes – new normal?
The imposition of a new tax on advertising is harmful. But at least in Poland’s case, there’s something more to this story. The Polish government has long moved away from a free-market economic model to a statist hybrid in which social spending, state-owned companies, and the national media are seen as parts of a single taxpayer-funded orchestra. And the demands of this orchestra are constantly increasing. The tax on advertising would already be the 35th tax raised, or imposed, by the current government. It is worth remembering that as far as new "big" taxes are concerned, in 2016 the so-called bank tax among other things, was introduced, bringing an additional 4 billion zlotys ( more than 1 million USD) a year to the budget. Those Poles, whose income exceeds one million zlotys (more than260,000.00 USD), pay the solidarity levy, enriching the government by another 1.2 billion zlotys (more than 315,000,000.00 USD). In turn, revenues from the sugar levy imposed this year on all drinks containing sugar, sweeteners, and caffeine, taurine, and guarana are expected to amount to around 3 billion zlotys in 2021 (more than 780,000,000.00 USD).
This year has also witnessed the introduction of the trade tax (i.e. tax on retail sales), which is expected to translate into an additional 1.5 billion zlotys (more than 390,000,000.00 USD) in the State coffers. The costs of new taxes are always passed on to the end customer. However, as far as manufacturers are concerned, they are not neutral either. Some new taxes are imposed on goods for which demand is highly elastic. Their producers raise prices, but at the same time are unable to maintain their former profitability. This translates into a reduction in the rate of investment in the economy, which is actually occurring in Poland, with the rate falling to 17.1 % in 2020 compared to 18.5 % in 2019. This is a rate 5 percent lower than the government's plan presented in 2016. (Strategy for Responsible Development).
Taxes are not the answer
The decline in private investment cannot be indefinitely replaced by the investments subsidized by state-owned companies and the creation of new such entities. Unfortunately, new taxes stifle investment not only because of a reduction in their expected profitability but also because of the complexity of the fiscal and regulatory system they cause. In fact, all taxes on products and services introduced in Poland are based on complex and not entirely clear (even for tax advisors) mechanisms of calculation and collection. Moreover, even the solutions meant to simplify tax settlements, in practice they work exactly in the opposite direction (Slim Vat, Estonian Cit, JPK). As a result, Poland occupies distant places in the rankings assessing the operation of the tax system. For example, in the International Tax Competitiveness Index, Poland is ranked 3rd from last among the OECD countries and penultimate in Europe (just behind Italy), and in the "Paying Taxes" category of the World Bank's "Doing Business" ranking, Poland is ranked as low as 77th - globally.
A complicated tax system means that companies have to spend more and more money on legal services and consulting, which consumes resources away from productive activity. The smaller the company, the less capital it can devote to dealing with regulatory complexity, which translates into fewer innovative ideas: they are simply nipped in the bud. Another effect of growing fiscalization and the associated bureaucratization is the room for tax optimization, or tax avoidance. The more regulations there are, the more space there is for various lobbying organizations to seek 'exemptions' from such taxes, with translates into stifling market competition.
Poland has enjoyed years of prosperity and in order to maintain the right policy course that contributed to the country’s success, the time of the pandemic should be a time devoted to reviewing the State’s economic policy, aimed at reducing fiscalism and reducing the regulatory burden.
*President of the Warsaw Enterprise Institute (Poland)
Photo Credit: Giuseppe Milo
Pipeline Worker Three Months After Biden Killed Keystone: “We’re hurting and we need jobs.”

"He's not helping us and I don't know of any unions that he's helped so far in other trades."
Fox Business Network's Carley Shimkus visited Bald Knob, Arkansas to interview workers affected by President Biden's harmful executive order to halt the KeystoneXL pipeline. Nearly three months after Biden's decision, workers and their families are hurting.
Here are some onsite quotes from the report:
"It's hard to make plans when you've got an administration that's trying to crush your future."
"I've looked for them green jobs and they are not there."
"I lost probably $60,000 - $80,000 not being able to go on that job. That's my livelihood. If I'm not working, I'm barely scraping by. I've got two kids to support, what am I supposed to do there?"
"My whole family is unemployed."
"The middle class is standing right here and looking at him [Biden] and telling him, 'we're hurting, and we need jobs.'"
"He's not helping us and I don't know of any unions that he's helped so far in other trades."
Americans for Tax Reform is collecting personal testimonials of Americans hit by President Biden's energy restrictions. (If you would like to submit a short video, please send it to Mike Mirsky at mmirsky@atr.org). Please see the examples below:
Pipeline Worker: "I've got my whole life invested in this."
“This is our livelihood. We don’t consider it a temporary job. We consider it as our career.”
Democrats Threaten to Oppose Biden Spending Plan if SALT Deduction Cap is not Repealed

Several Democrats from high-tax states have threatened to vote against Biden’s infrastructure plan if it does not include a full repeal of the State and Local Tax (SALT) deduction cap. This repeal would disproportionately benefit wealthy Americans.
As reported by Politico, dozens of Democrats have made this threat. On Tuesday, a powerful group of House Democrats — all but two members of the New York delegation — sent a letter demanding that the repeal of the SALT deduction cap be a part of any tax-related bills Congress takes up. Notably, Rep. Alexandria Ocasio-Cortez was one of the New York Democrats who refused to sign onto this letter. She had also voted against repealing the SALT deduction cap in 2019.
Several New Jersey Democrats like Rep. Josh Gottheimer and Rep. Bill Pascrell have also called for the repeal's inclusion in President Biden’s next legislative package.
In a press release by Senators Chuck Schumer and Kirsten Gillibrand, Sen. Gillibrand said, “I am proud to join my colleagues to introduce legislation to repeal the cap on the State and Local Tax deduction, a cynical policy passed by Republicans as a way to repay wealthy donors and lobbyists with big corporate tax cuts,” said Senator Gillibrand. This statement is especially ironic considering that lifting the SALT cap would be much more favorable to the rich than the Tax Cuts and Jobs Act was—with almost three times as much of the benefit going to the top one percent.
All of this begs the question: what is more important to these Democrats? A multi-trillion infrastructure bill, which they claim the country desperately needs, or tax cuts for their rich constituents?
Many progressives have noted that the SALT deduction disproportionately benefits the wealthy. The New York Times described the SALT deduction as “The Tax Cut for the Rich That Democrats Love.” The Center for American Progress has stated that repeal of the SALT cap “should not be a top priority” as it would “overwhelmingly benefit the wealthy, not the middle class.”
The left-of-center Tax Policy Center found that the top 1 percent of households would receive 56 percent of the benefit of repealing the SALT cap, and the top 5 percent of households would receive over 80 percent of the benefit. The bottom 80 percent of households would receive just 4 percent.
Similarly, the Brookings Institution explained that almost all (96 percent) of the benefits of SALT cap repeal would go to the top quintile, 57 percent would benefit the top one percent (a cut of $33,100), and 25 percent would benefit the top 0.1 percent (for an average tax cut of nearly $145,000). Whether or not this is a tax cut for the wealthy is not up for debate—the evidence is clear.
Repealing the SALT cap would be a costly addition to Biden's spending plan. Fully repealing the SALT deduction cap would cost $80 billion per year, or $400 billion in total, as the cap sunsets in 2026 along with several other tax provisions. This $400 billion proposal would tie Medicaid expansion for the single largest category in Joe Biden’s infrastructure plan. Because Democrats are attempting to fund this bill through tax hikes, the repeal of the SALT deduction cap could result in Democrats raising taxes elsewhere, including taxes directly or indirectly on low- and middle-income Americans.
Democrats falsely claim that when the unlimited SALT Cap was repealed, Americans in blue states like New Jersey and New York saw a massive tax hike and were hit with double taxation, as they now pay federal taxes on income that was already subject to state and local taxes.
In reality, a majority of Americans do not claim the SALT deduction, or any deduction. Instead, they claim the standard deduction. In 2018, 133 million American taxpayers (or 87% of filers) claimed the standard deduction. These taxpayers deduct zero state and local taxes, so they have no protection against double taxation.
Democrats from high-tax states are desperate to repeal the SALT deduction cap because their constituents do not like the true burden of high taxes if they cannot deduct it. Quantitative evidence shows that the SALT deduction does make high-income Americans more tolerant of high state taxes.
The high costs of living in states like New York, New Jersey, and California has resulted in a mass exodus. In New York, 66.4 percent of total moves were outbound. Similarly, 60.6 percent of New Jersey’s total moves were outbound.
Because their state legislatures refuse to provide relief for their constituents, Democrats are attempting to curb the sting of high taxes from the U.S. Congress.
At the same time President Biden and others on the left are pushing for the wealthy to "pay their fair share" in higher taxes, Blue State Democrats are pushing for tax cuts for their own wealthy constituents.
Photo Credit: The Leadership Conference on Civil and Human Rights
By Any Metric, Biden Spending Plan Spends Little on Infrastructure

President Joe Biden has proposed $2 trillion on “infrastructure” and is expected to soon propose another $2 trillion on “care infrastructure.
While infrastructure like roads and bridges is broadly popular with the American people, there is not much true infrastructure in this plan. Instead, it is the Left’s attempt to expand the federal government and provide a down-payments on socialist policies.
The first $2 trillion of Biden’s infrastructure plan contains little in true infrastructure spending. Instead, the proposal, which has been dubbed the “American Jobs Plan,” is a liberal wishlist of policies that have little, or nothing to do with roads and bridges.
Depending on how which metrics you use, the Biden plan spends as little as 6 percent of the $2 trillion on true infrastructure or as much as 25 percent. Either way, a significant portion of the plan is on policies that have little, or nothing to do with infrastructure:
- According to some estimates, less than 13 percent of the spending plan is spent on traditional infrastructure including less than 6 percent on roads and bridges, less than 2 percent on waterways, locks, dams, ports, and airports, and less than 5 percent on broadband.
- A fact check by the Washington Post argued that this analysis was misleading. They instead calculated that only about one-quarter (25%) of the Biden plan is spent on traditional infrastructure like “roads, bridges and airports to railways, ports, water systems, the electric grid and high-speed broadband.”
Either way, a vast majority of this spending will go to other projects.
Some of the non-infrastructure provisions in Biden’s plan include:
- $400 billion (20 percent) of the entire cost of the bill is for an expansion of Medicaid. This is the biggest single category of spending
- $213 billion for housing and to increase federal control of local housing markets
- $100 billion of additional funding for schools without requiring them to reopen
- $50 billion for a new office at the U.S. Department of Commerce
- $35 billion for climate science, innovation, and R&D
- $10 billion on a uniformed “Civilian Climate Corps”
- $174 billion toward consumer rebates for purchasing electric vehicles and funds for the government to buy electric vehicles
- Implementation of the PRO Act, which would ban Right to Work laws and reclassify millions of independent contractors as employees
The plan also includes spending on job training and small-business incubators, various types of research funding, public housing, upgrades to child-care centers, community colleges, VA hospitals, and other items.
There are a lot of ways you can group these spending initiatives: healthcare spending, education spending, entitlement spending, etc. This may be the first time, however, that they’re being categorized as “infrastructure spending.” Clearly, this is a misleading way to describe these initiatives.
The second part of Biden’s plan is a thinly veiled attempt to invoke “infrastructure” in the name of spending trillions of dollars on progressive priorities, which the Left dubs “human infrastructure” or “care infrastructure.” As the New York Times explains, this proposal would “spend heavily on education and programs meant to increase the participation of women in the labor force by helping them balance work and caregiving.”
While this proposal has not been released, it could include the following:
- Extending or making permanent expanded subsidies for low- and middle-income Americans to buy health insurance
- Extending or making permanent refundable tax credits aimed at cutting poverty
- Universal childcare
- Universal pre-K
- Federal paid family leave program
- Federal paid medical leave program
- A permanent expansion of the earned income tax credit (EITC)
Progressives see this bill as an opportunity to further their agenda. Senate Budget Committee Chairman Bernie Sanders (I-VT) urged President Biden to run with the idea of “human infrastructure,” citing that, “many of us see a crisis in human infrastructure.” Rep. Alexandria Ocasio-Cortez (D-NY) said that the existing plan “is not nearly enough,” and that it “needs to be way bigger.”
Ultimately, these policies are incremental steps towards the Green New Deal and Medicare for All. They would radically expand the welfare state and give the government more power and control over education and employment benefits.
The truth is, Biden’s spending plan has little to do with infrastructure. This plan is simply a way to push through leftist pipedreams under the guise of the popular term, “infrastructure.”
Photo Credit: Gage Skidmore
ATR, OCC Urges Congress To Reject The Misleadingly-Named “Paycheck Fairness Act”

The House of Representatives will soon vote on H.R. 7, the misleadingly-named “Paycheck Fairness Act,” legislation introduced by Rep. Rosa DeLauro (D-Conn.). If implemented, H.R. 7 would enact no new pay discrimination protections. Instead, the bill would give greedy trial lawyers unprecedented opportunity to target employers with frivolous lawsuits.
Americans for Tax Reform and the Open Competition Center oppose the Paycheck Fairness Act and urge all members of Congress to vote NO.
While the left claims H.R. 7 will close the “gender pay gap,” this legislation is not about equal pay for equal work. The Equal Pay Act of 1963 explicitly outlawed gender-based pay discrimination. And while men make slightly more on average than women, accurate estimates show that women make 95 to 98 cents per every dollar a man makes, a far narrower difference than the 22-cent pay gap the left constantly cites.
Under the Equal Pay Act, employees must provide evidence that their bosses are engaging in pay discrimination based on sex. Once they have provided the evidence, the burden of proof shifts to the employer to prove that the wage difference is based on “any factor other than sex.”
The Paycheck Fairness Act abolishes this decades-old standard and replaces it with a “bona fide factor other than sex” standard. This would require businesses to show that pay discrepancies between workers purportedly doing the same job are “consistent with business necessity.”
While these may seem like mild semantic differences, this change would erode crucial flexibility in the workplace. Currently, employers can negotiate employment and compensation arrangements with male and female workers that prefer more flexibility to a larger paycheck. Under the new “bona fide factor” standard, employers would likely be pressured to enact standardized compensation packages for employees to mitigate risk of litigation.
H.R. 7 would also lead to a dramatic decrease, or outright elimination, of performance-based pay in the American workplace. Under the new standard, employers could become liable for rewarding male and female employees with different bonuses based on performance, as a female worker could allege in court that these bonuses were not a “business necessity.” This risk would encourage businesses to adopt a uniform pay scale, reducing crucial incentives for employees to excel and suppressing pay across the board.
Additionally, H.R. 7 would automatically make workers part of class-action lawsuits unless they opt-out, encouraging greedy trial lawyers to reap a windfall by filing class-action suits against businesses. H.R. 7 also effectively removes the $300,000 cap for punitive damages for employment discrimination cases, putting employers at even greater risk of litigation.
Ultimately, the so-called Paycheck Fairness Act will only harm workers and expose employers to frivolous litigation. All members of Congress should vote NO.
Photo Credit: Dan Gaken
North Dakotans Will Get Stuck with Higher Utility Bills Due to Biden Corporate Tax Rate Hike

If Biden and the Democrats enact a corporate income tax rate increase, they will have to explain why they just increased your utility bills
If President Biden and congressional Democrats hike the corporate income tax rate, North Dakota households and businesses will get stuck with higher utility bills. Democrats plan to impose a corporate income tax rate increase to 28%, even higher than communist China's 25%.
Customers bear the cost of corporate income taxes imposed on utility companies. Corporate income tax cuts drive utility rates down, corporate income tax hikes drive utility rates up.
Electric, gas, and water companies must get their billing rates approved by the respective state utility commissions. When the 2017 Tax Cuts and Jobs Act cut the corporate income tax rate from 35% to 21%, utility companies worked with officials to pass along the tax savings to customers, including at least three North Dakota utilities.
Working with the Public Service Commission, MDU, Xcel Energy North Dakota and Otter Tail Power Company passed along tax savings to customers.
MDU: As noted in this Sept. 26, 2018 PSC statement:
In September 2017 the Commission approved a $4.6 million interim rate increase in accordance with state law. That interim rate was reduced to $2.7 million in March 2018 to reflect tax savings due to the Tax Cuts and Jobs Act. Because the agreement approved today includes a smaller increase than the interim rate, MDU natural gas customers will receive a refund for any excess revenue collected from September 2017 to present. The refund will be issued within 90 days of approval of a refund plan.
As part of the agreement, the fixed basic service charge will be $20.87 per month for residential customers. Because the rate approved today is less than the current interim rate, customers will actually see a decrease in their bills.
Otter Tail Power Company: Also as noted in the Sept. 26, 2018 PSC statement:
The PSC also today approved an approximately $4.6 million (3.09%) annual revenue increase for Otter Tail electric service. The company had originally asked for an increase of $13.1 million (8.72%). The company has not asked for a rate increase since 2008. Since then, Otter Tail Power has experienced increased operating expenses and costs driven by the company’s investments in generation, transmission, and distribution infrastructure.
In December 2017 the Commission approved a $12.8 million interim rate increase in accordance with state law. That interim rate was reduced to $8.3 million in February 2018 to reflect tax savings due to the Tax Cuts and Jobs Act. Because the agreement approved today includes a smaller increase than the interim rate, Otter Tail electric customers will receive a refund for any excess revenue collected from December 2017 to present. The refund will be issued within 90 days of implementation of the final rates.
As part of the agreement, the fixed basic service charge will be no higher than $14 a month for residential customers. Because the rate approved today is less than the current interim rate, customers will actually see a decrease in their bills.
Xcel Energy North Dakota: As noted in a Feb. 8, 2019 Fargo Forum article:
Utility companies across the country paid lower taxes after the federal Tax Cuts and Jobs Act of 2017 passed. Since then, states have been ordering those companies to pass on the savings to customers.
There was some discussion of using the money to improve energy equipment in North Dakota, or possibly holding down future rate increases.
But on Friday, Feb. 8, Xcel announced its North Dakota customers will receive a rebate. Xcel Energy will soon distribute nearly $10 million to all North Dakota electricity customers as a result of the federal tax cut. All Xcel Energy electricity customers in the state will receive a credit on their bills. The refund for a residential electricity customer will average about $46, but will vary based on each customer’s actual use.
The North Dakota Public Service Commission approved the refunds this week and customers should receive them as one-time bill credit beginning this spring.
As an additional part of the agreement, North Dakota customers will not see any increases in their base electric rates until at least Jan. 1, 2021, which is the earliest any future rate reviews could take effect. The agreement also allows Xcel Energy the ability to provide customers with additional refunds should the company achieve higher earnings than authorized by the commission.
Conversely, a vote for a corporate income tax rate hike is a vote for higher utility bills as households recover from the pandemic.
Many small businesses operate on tight margins and can't afford higher heating, cooling, gas, and refrigeration costs. President Biden should withdraw his tax increases.