With friends like these… Club for Growth, Heritage Action, and FreedomWorks have all come out against the House GOP’s American Health Care Act, designed to replace the Affordable Care Act. But the National Taxpayers Union backs it. HHS Secretary Tom Price calls it a “work in progress,” but President Trump says he’s “proud” to support it. It’s unlikely that the bill in its current form could pass the Senate.
Reminder: Repealing ACA taxes would cost a lot. The Joint Committee on Taxation estimates that repealing the Affordable Care Act's taxes would cost nearly $600 billion through 2026, and perhaps close to $700 billion through 2027. The Committee for a Responsible Federal Budget notes that “without further information, it is impossible to know if these tax cuts will be fully paid for as part of the House plan, though it is clear that the inclusion of these tax cuts will leave less revenue available to finance any coverage provisions.” Also worth noting: The Medicare Trust Fund would run out four years sooner without the ACA’s Medicare surtax.
Who benefits most from ACA tax credits? The Kaiser Family Foundation shares an interactive map to show you. The online tool compares county-level estimates of ACA premium tax credits—were they to be received in 2020—compared to what they’d be under the House GOP plan. “Generally, people who are older, lower-income, or live in high-premium areas (like Alaska and Arizona) receive larger tax subsidies under current law… Some who are younger, higher-income, or live in low-premium areas (like Massachusetts, New Hampshire, and Washington) may receive larger assistance under the replacement plan.”
“Tax credit scholarships” mean profit for some donors. The idea, touted by President Trump in his address to Congress last week, allows people and companies to earn state tax credits by giving money to private school scholarship funds. Donors can offset their state tax liability by 70 to 100 cents for every dollar they give. NPR explains that donors could also claim a federal charitable tax deduction on the same donation. Some could generate a 35 percent after-tax profit, including both state and federal tax deductions.
To make up for any federal funding cuts to sanctuary cities, Seattle’s Transit Riders Union (TRU) has a plan. Seattle could lose $85 million for housing, human services and transportation, should federal funding dry up. TRU proposes a city income tax of 2.5 percent on unearned income, such as corporate dividends and interest. Households earning more than $250,000 a year—5 to 10 percent of Seattle households—would pay the tax. Washington is one of seven states with no income tax.
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