President Obama continued to gallivant around the country on Monday, pushing to raise taxes on those deemed wealthy. The surprise will come in less than three weeks when the rest of us see our taxes go up as well.
Grover Norquist, founder of Americans for Tax Reform, describes what the president is doing as political sleight-of-hand. “It’s a magician’s misdirection,” the anti-tax activist told The Washington Times in an interview. “Obama is keeping people from noticing that the same day that the Bush tax cuts disappear, the Obama tax hikes show up. His unstated tax hike deliberately raises taxes on all Americans, not just rich people.”
Five major Obamacare taxes take effect on Jan. 1 that will cost taxpayers a whopping $1 trillion over 10 years, according to the Congressional Budget Office. The elderly will find it more difficult to write off medical expenses on their income taxes when the medical deduction minimum goes up from 7.4 to 10 percent of adjusted gross income. Families that take advantage of pre-tax flexible spending accounts to pay for out-of-pocket health care expenses will be newly limited to putting just $2,500 into that account.
There’s also a new 3.8 percent Obamacare surtax on investment income for individuals who make over $200,000 a year. Combined with the hike under debate in the fiscal cliff talks, capital gains taxes would jump from 15 percent to 23.8 percent and dividends from 15 percent to 43.4 percent. The Medicare payroll tax will jump to 3.8 percent for wages and profits exceeding $200,000 — a provision that most affects small-business owners stuck with the bill for the whole payroll tax.
Even disabled war veterans will feel the pain of the Obamacare tax hikes. A sneaky provision imposes a 2.3 percent excise tax on medical device sales, which will drive up the cost of everything from artificial joints and prosthetics to lifesaving machines like defibrillators, pacemakers and stents. According to a poll by the Emergo Group, 58 percent of American manufacturers say they will pass along some or all of the new costs to consumers.
Mr. Obama is facing a backlash from his own party on this. A group of 17 Democratic senators and senators-elect, including three elected leaders, wrote a letter on Dec. 4 to Senate Majority Leader Harry Reid asking that the tax be delayed as part of the final negotiations on the fiscal cliff. The letter, obtained by Dow Jones, explains to Mr. Reid that the 400,000 people in the United States who work in the industry could be affected by the confusion and uncertainty on how to comply with the tax hike.
The Obamacare tax hikes will raise the cost of health care for everyone, kill jobs and suck a trillion dollars out of the economy. Since there appears to be a growing bipartisan consensus that letting these taxes take effect would harm the economy, negotiators should do everything in their power to stop them in a final fiscal cliff deal.
Emily Miller is a senior editor for the Opinion pages at The Washington Times.
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Emily Miller is senior editor of opinion for The Washington Times. She won the 2012 Clark Mollenhoff Award for Investigative Reporting from the Institute on Political Journalism.
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