Saturday, June 30, 2012

It is not a big tax hike

Republicans immediately jumped on the Roberts decision:   changing the legal justification for ACA from regulating commerce to a tax.   So now they are hyper-ventilating about this "huge tax" burden.

It is not.   The only "tax" is the penalty for not purchasing health insurance.   So you either choose to buy health insurance, from which you will personally benefit -- or you pay a rather small penalty to the government along with your federal tax return.   Nobody is going to have the police showing up at the door.   You will simply owe the IRS for the penalty, just like any other unpaid tax bill.

The penalty amounts to something like $650 or a percentage of income over a certain amount for those with higher incomes -- and it can never cost more than a basic insurance policy would.   For those who cannot afford it, there will be government subsidies to help.

That is not, repeat NOT, a huge tax increase.    It is not the required purchase of insurance that is the tax;  it is the penalty for not buying it.  If Democrats can't shoot that one down, then they need a new crafter of campaign message.

Ralph

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