Health Care Reform: Tax the Rich?

Following up on yesterday’s post about taxes to pay for health care reform, here is where Charlie Rangel wants to go:

From The Hill:

The House will propose raising taxes on people earning more than $350,000 a year to pay $540 billion for healthcare reform, Ways and Means Committee Chairman Charlie Rangel (D-N.Y.) said Friday.

House Democrats had been weighing a plethora of other tax increases, such as levies on sugary soft drinks and alcohol, that raised hackles within their caucus.

Instead, Rangel said Democrats will seek to enact one large tax increase targeting wealthier workers to generate the revenue they need to finance their $1 trillion-plus healthcare reform bill.

“We have decided that instead of putting pieces of different revenue raisers together, that the best that we can do [is] we would have graduated surtaxes starting at [$]350],000],” Rangel said. The tax hikes would begin in 2011 and raise $540 billion over 10 years, he said after a meeting with Democratic committee members.

The price tag of the bill is expected to be around $1 trillion. Democrats have already tentatively assembled a package of spending cuts worth around $500 billion, mostly from Medicare and Medicaid.

According to the article there would be surcharges of 1%, 2% and 3% at income levels of $350,000, $500,000 and $1,000,000 respectively.

Of course, this is the going in price. We all know that over the long run this program is going to actually save money by controlling costs — don’t we? So surely these surcharges are temporary.

Comments

[mdmrjsds:]

When asked why he robbed banks, Willie Sutton answered, "Because that's where the money is."

Jul 12 11:31 AM

[nym:]

Small price to pay.

Jul 12 07:41 PM

[YoYoMama:]

With almost a 1/3 of our country obese, and given that most of the time this is a lifestyle choice; and given that most of these persons have multiple health problems...

Why not tax fast food?

Jul 13 09:20 AM

[a. palmer jr.:]

I don't think it will work taxing the rich. For one thing there's not that many of them, and are becoming less all the time. For another, the rich usually can hide their assets and take measures to make it look like they're not rich.
Now what will really happen: Congress will cut Medicare, Medicaid, and Social Security. Eventually they will also have to raise taxes on everybody making between $20000 and $70000 because that's what the majority of people in this country make. I know they said they wouldn't do it but I'm betting they will.

Jul 13 09:26 PM

[a. palmer jr.:]

Oh, by the way, that remark about taxing fast food....I think they already do, at least in my state.

Jul 13 09:28 PM