The "President's Proposal" for a health care overhaul, released today, includes some hefty tax increases. Here are links to a few from the White House Web site. An increased Medicare payroll tax: "The Act will include an additional 0.9 percentage point Hospital Insurance tax for households with incomes exceeding $200,000 for singles and $250,000 for married couples filing jointly. In addition, it would add a 2.9 percent tax for such high-income households to unearned income including interest, dividends, annuities, royalties and rents (excluding income from active participation in S corporations)." It's hard to see how President Obama, a bestselling author himself, considers royalties to be unearned income, unless you buy American Thinker's theory that Bill Ayers did a lot of the work on Dreams From My Father. And it'll be interesting to see whether this tax on "unearned income" includes interest on Treasury bills and on municipal bonds. The current 15% tax rate on dividends is scheduled to expire at the end of 2010, and it'll be interesting to see if the Obama 2.9% tax is added to the top of another increase. Won't this tax increase be reflected in a decline in the value of rent-paying and dividend-paying assets, i.e., commercial real estate and the stock market? There's a tax on policies with premiums above $27,500 a year for families, a tax the law imposes "beginning in 2018," by which time Mr. Obama will, conveniently, be out of office and therefore not liable for any political fallout from the tax. If this tax is such a swell idea, why wait eight years to impose it? And why do the $250,000-a-year couples with dividend income get socked with their tax increase immediately, while the union guys with Cadillac health plans get a tax holiday until 2018? There are taxes on prescription drugs, medical devices, health insurance companies, and indoor tanning services. The White House characterizes the taxes on the drug companies and the health insurers as "fees."
Obama Goes for Tax Increases