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The Republican healthcare bill could make it easier for the GOP to pass the kind of tax reform they are working toward. It cuts expenses, which makes room for tax cuts to be made during the budget reconciliation process.
On March 9th, 2017 the House Ways & Means and Energy & Commerce committees passed two bills jointly referred to as the "American Health Care Act" (AHCA). These bills provide budget reconciliation recommendations that amount to the repeal of many of the core features of the Obama administration's Affordable Care Act (ACA). To become law, the AHCA will have to pass in the House, then in the Senate, and then President Trump will have to sign it.
On March 14th, the Congressional Budget Office (CBO), which is responsible for scoring bills that affect expenditures, and the Joint Committee on Taxation (JCT), which is responsible for scoring bills that affect revenue, released a cost estimate for the AHCA.
Howard Gleckman, Senior Fellow at the Tax Policy Center, expresses concerns:
The House Republican proposal to repeal or delay the tax increases in the Affordable Care Act, including the revenue-raisers and the individual and employer mandate tax penalties, would overwhelmingly benefit high-income households, according to new estimates by the Tax Policy Center. Forty percent of the benefit of those tax cuts would go to the highest-income one percent—those making more than $772,000 in 2022.
John Kartch, VP of Communications for Americans for Tax Reform, articulates a more favorable outlook on the bill, and quotes ATR's president:
"Repealing Obamacare’s taxes will provide much needed relief to the paychecks of families across the country,” said Grover Norquist, president of Americans for Tax Reform. “Repealing Obamacare will also undo Barack Obama’s broken promise not to sign ‘any form of tax increase’ on any American making less than $250,000. Obamacare, from the start, was a trillion-dollar collection of tax hikes with a stethoscope stapled to the top. The CBO, which understated Obamacare's costs and exaggerated its ‘benefits’ now with hindsight can tell us the actual size and scope of the taxes we will now repeal with passage of the AHCA,” said Norquist.
The AHCA cuts Medicaid by $880 billion and reduces insurance subsidies by $680 billion. The Republicans have not been shy about their intentions to pass a tax reform bill using the budget reconciliation process, which allows them to pass legislation using their simple majority as long as they replace revenue lost in one place with revenue from somewhere else. Well, an expenditure saved is a tax cut earned. All told the AHCA would fund $883 billion in tax cuts over the next 10 years.
Regardless of the mixed reviews of the AHCA, many American taxpayers and policy analysts have criticized the House Ways and Means Committee's tax reform proposals. Farmers and small businesses, mom and pop property owners, retirement-age property owners, and others would be directly hurt, and many analysts predict that the proposed reforms would slam the entire economy.
Voters who haven't yet expressed their concerns to Congress still have time to do so. Click here and fill out the form to send your own representative and senators a letter, urging them to #StopBillionaireBailouts!