Oops – We Read it Again
Last Friday, President Obama had a press “cattle-call” at the White House, inviting correspondents from selected media outlets (FOX News notably excluded) to have one-on-one sit down interviews that were aired on Sunday morning. One by one, correspondents filed into a White House office with the President seated in an armchair ready to promote his latest agenda. One such interview took place with George Stephanopoulos of ABC News.
During the interview, Stephanopoulos pointed out to the President that it appeared as though he was willing to renege on his “No New Taxes” campaign promise on families making less than $250K a year by supporting a health care bill that included a penalty for an individual whose annual income is 100 percent of the Federal Poverty Line or above. The President’s response, “… Nobody considers that a tax increase.”
To quote Ronald Reagan, “Well… there you go again.” The problem with the President’s comment is that the Baucus Bill introduced last week calls the penalty he was talking about an “Excise Tax” on an individual/family ranging from $750 to $3,800 a year. Here is the text (emphasis added) [1]:
Baucus Health Care Bill, page 32:
Excise Tax: The consequence for not maintaining insurance would be an excise tax. If a taxpayer’s MAGI is between 100-300 percent of FPL, the excise tax for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or an individual claimed as a dependent) is $750 per year. However, the maximum penalty for the taxpayer unit is $1,500. If a taxpayer’s MAGI is above 300 percent of FPL the penalty for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or as an individual claimed as a dependent) is $950 year. However, the maximum penalty amount a family above 300 percent of FPL would pay is $3,800.
... The excise tax would be assessed through the tax code and applied as an additional amount of Federal Tax owed.
Like my Grandpa used to say… if it looks like a duck, walks like a duck, and quacks like a duck – it’s a duck!
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