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Update on GOP’s Tax Cut Legislation

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With the GOP’s tax cut legislation proposed, the Senate tax-writing committee is already preparing to develop details in hopes of a possible vote early Thursday.

The following is an update on the proposal’s possible effects on current mandates regulated under the Affordable Care Act (ACA):

President Trump has repeatedly echoed his cry for Congress to repeal the ACA’s provisions to require individuals to purchase healthcare insurance, claiming that the retraction will result in savings that could assist in offsetting an insurance rate cut for top-grossing individuals.

The Congressional Budget Office (CBO) has estimated that the repeal of the individual mandates would generate approximately $338 billion over the next 10 years. However, this $338 billion will be met with an estimated 13 million Americans forgoing insurance coverage by 2027. Additionally, the CBO also stated that the government would no longer have to subsidize coverage for those roughly 13 million individuals.

In his twitter statement early this morning, President Trump tweeted:

“I am proud of the Rep. House & Senate for working so hard on cutting taxes {& reform. We’re getting close! Now, how about ending the unfair & highly unpopular Indiv Mandate in OCare & reducing taxes even further? Cut top rate to 35% w/all of the rest going to middle-income cuts?”

The current income tax rate for individuals earning more than $418,400 and for couples earning $470,700 or more is 39 percent. The tax proposal that is currently under consideration in the House would leave that rate in place for individuals earning more than $500,000 a year and couples earning more than $1 million. The Senate plan would also cut the top tax rate to 38.5 percent and apply it directly to the same income thresholds as the House.

Have an opinion on the issue? Contact Rick Keaton to voice your concerns!

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