Ringing In The New Year With New ObamaCare Taxes

ObamaCare’s 2013 Taxes Are Devastating For The American Economy And The American People

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“New Taxes Are Coming Jan. 1 To Help Finance President Barack Obama’s Health Care Overhaul.” (Ricardo Alonso-Zaldivar, “Health Care Tax Hikes For 2013 May Be Just A Start,” The Associated Press, 12/25/12)

MEDICAL DEVICE MANUFACTURERS WILL BE TAXED

Medical Device Manufacturers Are Now Subject To A 2.3 Percent Sales Tax That Will Lead To A Loss Of Jobs And Higher Costs For Consumers. “A 2.3 percent sales tax on medical devices used by hospitals and doctors. Industry is trying to delay or repeal the tax, saying it will lead to a loss of jobs. Several economists say manufacturers should be able to pass on most of the cost.” (Ricardo Alonso-Zaldivar, “Health Care Tax Hikes For 2013 May Be Just A Start,” The Associated Press, 12/25/12)

The Tax Is Projected To Raise $29 Billion And Will Affect Manufacturers “From Thermometers To MRI Machines.” “On Wednesday, an Internal Revenue Service final rule detailed plans to levy the tax. It was originally projected to raise up to $20 billion in revenues over 10 years, but the Joint Committee on Taxation later estimated it would be around $29 billion. The 58-page device rule lays out a tax structure for an industry that manufactures everything from thermometers to MRI machines.” (Jason Millman, “Medical Device Tax Set But Industry Still Fighting,” Politico, 12/6/12)

  • In Addition To High-Tech Burn Treatments, Catheters And Back Braces Will Be Subjected To The Tax. “The 2.3 percent excise tax that device makers must pay on their gross sales goes into effect on Jan. 1. It’s one of the new revenues used to offset the cost of the healthcare law. The Internal Revenue Service issued Wednesday its final rules on the tax, which will impact profits on items such as high-tech burn treatments, catheters, back braces and in-home HIV tests.” (Colby Itkowitz, “Casey Calls For Delay Of Medical Device Tax,” The Morning Call , 12/7/12)
  • Pacemakers And “Experimental Cancer Treatment Devices” Will Also Be Subject To The Tax. “The tax applies mostly to devices used and implanted by medical professionals, including items as complex as pacemakers or as simple as tongue depressors. Products sold for humanitarian reasons, such as experimental cancer treatment devices, are not exempt from the tax.” (“IRS Finalizes New Tax For Medical Devices In Health Care Law,” Reuters, 12/5/12)

The Medical Device Industry Projects That 43,000 Jobs Are Now Jeopardized By The Tax While The Industry Has Already Cut Nearly 6,000 Jobs In Anticipation Of The Tax. “Lobbyists for medical device makers say implementation of the tax could jeopardize about 43,000 jobs nationwide in a $64.7 billion industry. They say companies have shed about 6,000 jobs in the past year, some in anticipation of the tax, while others might scuttle expansion plans or cut back on research that can lead to medical breakthroughs.” (Bob Salsberg, “Medical Device Makers: Jan. 1 Tax Could Cost Jobs,” The Associated Press, 12/28/12)

OBAMACARE WILL CUT FLEXIBLE SPENDING ACCOUNTS

ObamaCare Limits The Amount An Employee Can Contribute To Their “Tax-Free Flexible Spending Accounts For Medical Expenses. “A limit on the amount employees can contribute to tax-free flexible spending accounts for medical expenses. It’s set at $2,500 for 2013, and indexed thereafter for inflation.” (Ricardo Alonso-Zaldivar, “Health Care Tax Hikes For 2013 May Be Just A Start,” The Associated Press, 12/25/12)

  • Flexible Spending Plans, Which Lower Out Of Pocket Expenses, "Will Be Cut In Half." “To pay for this sweeping reform, here’s what will change: Those tax-free flexible spending accounts will be cut in half. They reimburse some medical bills not covered by insurance. The new cap: $2,500.” (Mark Strassmann, “Already Insured? Get Ready To Pay More,” CBS News, 3/22/10)

The Limit Will Result In $24 Billion In New Taxes Over 10 Years. ( “Estimated Revenue Effects Of A Proposal To Repeal Certain Tax Provisions Contained In The ‘Affordable Care Act,’” Joint Committee On Taxation, 6/15/12)

  • The Middle-Class Will Be Hit By The Tax On Health Savings Accounts And Flexible Spending Accounts. “Other provisions directly affecting individuals and families with incomes below $200,000 and $250,000, respectively include the increase in additional tax on distributions from health savings accounts and flexible spending arrangements not used for medical expenses and limitations on health flexible spending arrangements in cafeteria plans.” (Joint Committee On Taxation, Letter To Senator Tom Coburn , 3/20/12)
  • The Tax Will Affect More Than 20 Million Americans. “The trend, triggered by the 2010 health-care law, affects more than 20 million Americans with flexible spending or health savings accounts that let them use pretax dollars for medical needs.” (Jeffrey Young, “Doctors Hit By Aspirin Demands As Health Law Restricts Accounts,” Bloomberg, 8/23/11)

The New Limits On Flexible Spending Accounts Will Drive Up Medical Costs And Create Unnecessary Work. “Doctors pharmacists, insurers and drug companies say while it may generate money to help expand coverage for the uninsured, the measure is driving up medical costs and creating unnecessary work.” (Jeffrey Young, “Doctors Hit By Aspirin Demands As Health Law Restricts Accounts,” Bloomberg, 8/23/11)

OBAMACARE’S TAXES WILL HIT THE MIDDLE-CLASS

ObamaCare’s Largest Tax Hike, Referred To As A “Medicare Contribution” Will Not Strengthen Medicare’s Trust Fund. “The biggest tax hike from the health care law has a bit of mystery to it. The legislation calls it a ‘Medicare contribution,’ but none of the revenue will go to the Medicare trust fund. Instead, it’s funneled into the government’s general fund, which does pay the lion’s share of Medicare outpatient and prescription costs, but also covers most other things the government does.” (Ricardo Alonso-Zaldivar, “Health Care Tax Hikes For 2013 May Be Just A Start,” The Associated Press, 12/25/12)

  • The 3.8 Percent Tax On Investment Income Is “Projected To Raise $123 Billion.” “The new tax is a 3.8 percent levy on investment income that applies to individuals making more than $200,000 or married couples above $250,000. Projected to raise $123 billion from 2013-2019, it comes on top of other taxes on investment income.” (Ricardo Alonso-Zaldivar, “Health Care Tax Hikes For 2013 May Be Just A Start,” The Associated Press, 12/25/12)
  • "This Is The First Time That Unearned Income Will Be Subject To A Medicare Tax." (Aaron E. Carroll, “2013: How Health Care Will Affect You,” CNN, 12/28/12)

ObamaCare Adds “An Additional Medicare Payroll Tax.” “High earners will face another new tax under the health care law Jan. 1. It’s an additional Medicare payroll tax of 0.9 percent on wage income above $200,000 for an individual or $250,000 for couples. This one does go to the Medicare trust fund.” (Ricardo Alonso-Zaldivar, “Health Care Tax Hikes For 2013 May Be Just A Start,” The Associated Press, 12/25/12)

The Wall Street Journal : The Increased Medicare Surtax Will Affect “Many Middle-Class Families” As The New Medicare Taxes “Aren’t Indexed For Inflation.” “Oh, and these new taxes aren’t indexed for inflation, so many middle-class families will soon be considered rich and pay the surcharge as their incomes rise past $250,000 due to tax-bracket creep. Remember how the Alternative Minimum Tax was supposed to apply only to a handful of millionaires?” (Editorial, “Taxes Upon Taxes Upon…,” The Wall Street Journal, 7/11/11)

  • "Taxpayer Costs Over 10 Years: $210 Billion.” (Editorial, “Taxes Upon Taxes Upon…,” The Wall Street Journal, 7/11/11)