There’s the Robin Hood:
A little-noticed provision in President Obama’s new jobs bill seeks to tax healthcare benefits for the wealthy, a controversial idea that went nowhere during the healthcare reform debate.
An administration official said, “This proposal is part of a balanced deficit-reduction plan that includes closing corporate tax loopholes and asking the wealthiest Americans to pay their fair share. Currently, individuals and families in the 35 percent tax bracket receive $0.35 off their taxes for every $1 in tax deductions and exclusions, including employer contributions to health. This proposal would change the limit to $0.28, making the deduction more in line with what middle class families receive today. No individual earning less than $200,000 and family earning less than $250,000 would be affected by this proposal.”
“Employer-sponsored insurance in general is still going to be a great benefit to upper-income people,” said Paul N. Van de Water, a senior fellow at the liberal-leaning Center on Budget and Policy Priorities who has written extensively about the tax treatment of healthcare benefits. “This proposal still means that high-income people get more of a benefit than middle- and low-income people. It’s just capped so the benefit doesn’t continue to rise with income as much as it does under current law.”
And, then, there’s the reverse Robin Hood:
Yesterday, Missouri lawmakers began a special session during which Republicans will try to pay for a business tax cut by eliminating a tax credit that benefits more than 100,000 senior citizens and disabled people.
Missouri Republicans are just the latest in a long list of state legislatures that are funding more corporate tax breaks on the backs of low- and middle-income residents. In this case, Republicans are targeting a property tax credit that helps offset higher rent for some of the state’s most vulnerable citizens: At stake is a tax credit that provides up to $750 for lower-income elderly and disabled people. Called the “Circuit Breaker,” it is designed to be an offset for the property taxes included in the rent paid by people with incomes of $27,500 or less. The tax credit costs $53 million annually. Repeal is part of a package that also would impose limits and sunset dates on credits targeted to developers. The Circuit Breaker tax credit is the only credit slated for repeal.
The Post-Dispatch reports that Republicans have faced such a backlash for trying to repeal the tax credit that the tax-credit package they crafted may be unraveling.
I love this quote:
“Republicans are always portrayed as taking from the poor and giving to the rich, and we didn’t want to do that,” Purgason said.
I wonder why they’re always portrayed as taking from the poor and giving to the rich? Because that’s exactly what they are trying to do? Nah. It must just be another unfair portrayal. They’re the victims in all this, really, when you think about it.