There's been a lot of yammering about the taxes in the Affordable Care Act. Apart from the penalty for not complying with the mandate, here's a rundown of the actual tax hikes in the bill. And hey -- guess what? They're both (all two of them) are taxes against wealthier Americans who can very much afford the extra pennies on the dollar.
So where does the money come from? The law’s biggest tax increase, at least in the first decade, is a 0.9 percent increase in the Medicare payroll tax paid by Americans earning more than $200,000 a year. Long-term, however, the largest increase — and certainly the most important one for the future of the health-care system — will be the excise tax on high-value health insurance plans, which begins in 2018.
Few phrases in the English language send readers fleeing as quickly as “excise tax on high-value health insurance plans.” So I’ll try to explain this as quickly and painlessly as possible. It’s a tax on unusually expensive, employer-provided health insurance plans. It begins at $10,200 for an individual plan and $27,500 for a family plan. Above that, there’s a 40 percent tax on the excess premiums. So if your plan is valued at $11,200, your employer will pay a 40 percent tax on the $1,000 surplus.
Screech! And just a reminder: the so-called "biggest tax hike in history" is much smaller than the Reagan tax hike of 1982.
