By David Morgan
WASHINGTON (Reuters) – A Republican plan to repeal taxes under Obamacare would benefit the wealthiest American households at more than five times the rate of middle-income families, according to the nonpartisan Center for Fiscal Policy.
“The effects are really very dramatic. We found that a typical middle-income family would get a tax cut of around $ 300, while people in the top 0.1 percent would get a tax cut of around $ 207,000,” Howard Gleckman, a senior member of the nonprofit research group, said Monday. (http://tpc.io/2n1Mdwi)
Expected benefits equal 2.6 percent of the after-tax income of a wealthy family, but only 0.5 percent of the income of a middle-class household earning between $ 51,600 and $ 89,400 a year, including fringe benefits like Employer-provided health insurance, the center estimated. The top 0.1 percent of American families have incomes of at least $ 3.9 million.
The proposed changes are part of a plan backed by Republican President Donald Trump to repeal and replace the law officially known as the Affordable Care Act, the national legislation signed by former Democratic President Barack Obama. In total, the tax portion would eliminate liens worth $ 600 billion in revenue over a decade.
If adopted, the plan could be the first in a series of tax cuts promised by Trump, who has vowed to lower taxes further through separate legislation to revise the US tax code.
The Congressional Budget Office, which provides official cost estimates for the legislation, said on Monday that 14 million more people would be uninsured in 2018 and 24 million more in 2026 if the plan under consideration in the House were adopted. Representatives. The Republican plan would also reduce federal deficits by $ 337 billion between 2017 and 2026, the office said.
House Speaker Paul Ryan, the Republican health plan’s main sponsor in Congress, and the office of House Democratic Leader Nancy Pelosi, had no immediate comment.
Trump defended the Republican plan on Monday, telling a group of Obamacare opponents that the replacement would offer more coverage options at lower costs.
Obama raised taxes on the wealthy to fund health care benefits for low- and middle-income Americans under his health care law, which has extended coverage to 20 million previously uninsured people through private coverage. subsidized and the Medicaid program for the poor.
Democrats claim that Republicans would now help the rich at the expense of families that depend on Obamacare subsidies.
Repeal of just two ACA taxes, a 3.8 percent investment tax and a 0.9 percent Medicare payroll tax for people earning $ 200,000 or more a year, would return about $ 275 billion. to taxpayers for 10 years, according to the Joint Congressional Tax Committee, or JCT, said in a report last week.
About 60 percent of that sum would go to those with incomes of $ 1 million a year or more, according to a Reuters analysis of JCT data released to Congress alone.
In addition to investment and hospital taxes, the Tax Policy Center also included the effects of repealing Obamacare’s tax penalties for the uninsured and uninsured employers, and special taxes on health care providers and insurers.
The researchers found that 40 percent of the benefits from the proposed tax changes would go to households making more than $ 772,000 a year in 2022, when the cuts would be fully effective.