Washington – Congressional plans to fund a massive health-care overhaul could have a job-killing effect on New York, creating a tax rate of nearly 60 percent for the state’s top earners and possibly pressuring small-business owners to shed workers.
New York’s top income bracket could reach as high as 57 percent — rates not seen in three decades — to pay for the massive health coverage proposed by House Democrats this week.
The top rate in New York City, home to many of the state’s wealthiest people, would be 58.68 percent, a Washington-based Tax Foundation said in a report.
That means New York’s top earners, small-business owners and most dynamic entrepreneurs will be facing new fees and penalties.
The $544 billion tax hike would violate one of President Obama’s ironclad campaign promises: No family will pay higher tax rates than they would have paid in the 1990s.
The legislation is especially onerous for business owners, in part because it penalizes employers with a payroll bigger than $400,000 some 8 percent of wages if they don’t offer health care.
But the cost of the buy-in to the program may be so prohibitive that it will dissuade owners from growing their businesses — a scary prospect in the midst of a recession.
Obama took to the airwaves yesterday with ads and TV interviews promoting the need to reform health care.
As a Senate health committee passed a different version of a health-care reform bill – a milestone for the issue – Obama said on NBC, “The American people have to realize that there’s no such thing as a free lunch.”
(Source: NY Post)
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2 Responses
Combined tax rates in the past were as high as 90%.
Onerous yes, terrifying no. It will only hurt if people can move to avoid the tax (and in all fairness, US taxes are lower than most other countries). If a tax is “per employee” or a percentage of wages paid to employees, it will
discourage hiring local workers.
If small employers get to buy health insurance at the same low rates that big employers pay, it will actually be a fanatstic deal (in other words, the fact that your firm consists of frum people who like to have babies won’t result in higher fees that people who are healthy and celibate). Very few private insurance companies will agree to this unless bribed or coerced.
akuperma, it would be foolish for insurance companies to do as you suggest. Do you also believe that car insurance companies should have the same rates for good and bad drivers? Underwriting the risk is an important part of insurance – it makes the insured participate in the cost of his or her own insurable behavior.
I have a feeling that the “reformed health care” Obama keeps repeating will be comparable to reform judaism – re-formed (as in recreated) and a complete corruption and destruction of what is good.