The 2014 ObamaCare Tax Wave
January 14, 2014
2014 is full of new taxes thanks to ObamaCare, says Politico.
Insurance companies say that all of the higher taxes that they will be forced to pay will be passed on to consumers who will have to pay higher premiums. Of the new taxes set to go into effect this year, one of the largest is the HIT (health insurance tax):
- HIT is a multibillion dollar tax imposed on insurance companies based on their market share. Companies will collectively pay $8 billion in the HIT this year, with annual collections rising to $14.3 billion by 2018.
- Consulting firm Oliver Wyman conducted a study that found that the HIT would increase health insurance premiums by more than $2,800 per person and $6,800 per family over a decade.
- The nonpartisan Joint Committee on Taxation said that premiums should increase by about $350 to $400 per family by 2016. In a letter to former Senator Jon Kyl, the Committee wrote, "The fact that the statutory incidence of the health insurance fee is on the insurer does not alter the economic incidence of the tax, which is the same regardless of who writes the check to the government."
Insurers are also subject to a temporary, three-year tax that kicked in at the start of 2014. Insurers will have to pay $63 per health insurance recipient to the government, which will redistribute that money to insurance companies that are taking on the most expensive patients.
- There is also a 3.8 percent surtax on capital gains and dividends for couples earning above $250,000.
- That, combined with the 0.9 percent Medicare wage tax increase that was imposed in 2013, is expected to bring in $317 billion over 10 years.
One of the other major ObamaCare taxes, the Cadillac health plan tax, is not set to begin until 2018.
Source: Rachael Bade, "The 2014 ObamaCare Tax Wave," Politico, January 6, 2014.
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