Chimpy proposes a massive tax increase.
President George W. Bush’s plan to revamp the health-care system would increase taxes on Americans by $526.2 billion over the next decade, according to a congressional estimate that calls into question administration claims of cost and tax savings.
A “very preliminary” unreleased report by the staff of the non-partisan congressional Joint Committee on Taxation estimates that Bush’s proposal would begin imposing higher taxes by 2011.
The estimate, which covers the next 10 years, suggests health care costs may not fall under the White House plan. The Bush administration said the change would reduce health-care costs by making Americans smarter consumers and encouraging insurers to compete for individuals’ business.
“It sounds like they’re assuming health-care costs are going to go up quite rapidly, and therefore the effective deduction is buying less and less health insurance over time,” William Gale, a senior fellow at the Brookings Institution, said of report’s findings, after they were described to him.
Former Republican Representative Pat Toomey of Pennsylvania, president of the Washington-based Club for Growth, which has supported the president’s proposal, said in an interview that it would be “problematic” if the joint committee’s estimate is accurate.
Toomey said if that’s the case, Congress should consider indexing the deduction for inflation associated with health care rather than the consumer price index. “That might solve the problem,” he said.
The Treasury Department said last month that the health tax- overhaul proposal would reduce taxes by a net $32.7 billion over the next decade because of the tax deductions it would create.