The AHCA is a Redistribution of Wealth: From the Poorest to the Richest
May 25, 201
When Scott Tipton voted in favor of the AHCA, did he realize that it amounted to a dramatic transfer of wealth from the poor to the rich ? The AHCA’s revised CBO score isn’t any prettier than the original score- the revised score indicates 23 million less people will be insured 10 years from now than would be under the current system — this includes a staggering 14 million who been covered under Medicaid under the ACA.
When considering that 14 million less low-income individuals would be covered by Medicaid under the AHCA, it is particularly staggering to consider how many of these people could still be covered if the AHCA did not repeal both the 3.8% Net Investment Income Tax (NIIT) & the .9% Additional Medicare Tax. It’s impossible to appreciate just how insane this bill is until you consider the effects of repealing these taxes.
The 3.8% NIIT is a tax on investment incomes that applies to single individuals making 200,000+ annually or to couples making 250,000+ annually. The CBO projected that repealing this tax would reduce tax revenue by ~170 Billion dollars over the next 10 years. The Tax Policy Center provided a breakdown of who benefits from the repeal of this tax and by how much, and it’s really quite incredible-
No individual making less than 200,000 / no household making less than 250,000 get any reduction in taxes from the repeal.
Amongst individuals/households making between ~200,000 & ~300,000, less than 9% of them would receive a tax cut, and the average tax cut in this group would be less than 400 dollars.
Amongst individuals/households in the top .1% — those making over 3.75 million dollars annually- ~99% of them would receive a tax cut, and the average tax cut for them would be over 165,000 dollars.
The .9% Additional Medicare Tax is a very similar story — it applies to wages / self-employment income for singles making 200,000+ annually or to couples making 250,000+ annually. The CBO projected that repealing this tax would reduce tax revenue by ~145 billion dollars over the next 10 years.
And the beneficiaries of this tax cut are also very similar –
No individual making less than 200,000 / no household making less than 250,000 gets any reduction in taxes from the repeal.
7% of individuals/households making between ~200,000 & ~300,000 would receive a tax cut, and the average tax cut for them would be ~200 dollars.
75% of the top .1% would receive a tax cut from it, and the average tax cut for them would be ~40,000 dollars.
It is impossible for me to comprehend passing a bill that would lead to such dramatic cuts in coverage while simultaneously providing 300 billion dollars worth of tax cuts to the wealthiest households.
Jeremy Leone lives in Grand Junction, Colorado. He hasn't been politically active for most of his life but has always been interested in politics, in particular in the shortcomings our current system has with regards to valuing human life in the humanistic tradition.