The Republican answer to the Obamacare repeal-and-replace question has been answered: It’s another humongous tax cut for the very rich.
The Center for a Responsible Budget (CRB) analyzed figures from the Joint Committee on Taxation, and found that under the Republicans’ healthcare reform proposal, roughly $600 billion in tax cuts would be given out, mostly to the benefit of the super-rich. Vox estimated that income earners in the top 0.1 percent of the income spectrum — who make at least $3.75 million per year — would reap over $195,000 in tax breaks apiece. The CRB’s chart breaks down each tax break individually, concluding that the GOP’s healthcare proposal amounts to roughly $594 billion in total tax breaks:
President Barack Obama’s Patient and Protection and Affordable Care Act (Obamacare) levied additional taxes on income that’s typically earned by the very wealthy, like capital gains, dividend, and interest income usually made from selling investments.
Obamacare’s 3.8 percent capital gains tax would be eliminated if the Republican healthcare bill became law, households with more than $250,000 in annual income would benefit from the tax break. The 0.9 percent Medicare tax included in Obamacare would also be repealed under the Republican plan, exempting households bringing in at least $250,000 in annual income from having to pay the tax.
To contrast, families in the bottom 90 percent of income earners would get $0 in tax breaks under the proposal to eliminate the additional investment income tax, according to the nonpartisan Tax Policy Center. As the chart below shows, the first four income quintiles would see no decrease in the percentage of taxes paid. However, the top quintile would see their tax bill cut by an average of 0.4 percent under the proposal:
The Trump/Ryan plan is already being met with resistance in the U.S. Senate, with enough Republican senators raging against it to make passage highly unlikely as of this writing.
Tom Cahill is a writer for the Resistance Report based in the Pacific Northwest. He specializes in coverage of political, economic, and environmental news. You can contact him via email at [email protected], or follow him on Facebook.