This is the second installment in a five-part series on the taxes embedded in Obamacare. The first installment, “The five tax hikes in Obamacare that most hurt seniors,” can be found here.
The jobs-killing Obamacare law contains 20 new or higher taxes on American families and employers. Many of these tax increases fall on families making less than $250,000 — a direct violation of candidate Obama’s promise not to raise “any form” of taxes on these families. In less than a week, the second anniversary of Obamacare being signed into law will take place. The Supreme Court will be hearing oral arguments about the constitutionality of Obamacare next week.
Out of the 20 new or higher taxes in Obamacare, there are five that most hurt women. All of them violate President Obama’s commitment to families making less than $250,000.
The first is the excise tax for failing to comply with Obamacare’s “individual mandate.” Under Obamacare, if you do not purchase “qualifying health insurance” by 2014, you face an excise tax mandate which reaches at least 2.5 percent of adjusted gross income by 2016. Women will be forced to spend money on health insurance that they may neither need nor want. Some may find that their existing health insurance, which they like, is suddenly deemed “not qualified” by the government. This mandate endangers the ability of women to keep their own doctors and their own health insurance plans. What was it that President Obama said? “If you like your plan, you can keep it.”
Another is the so-called “Cadillac plan” excise tax. Obamacare imposes in 2018 a 40 percent excise tax on high-cost health insurance plans (defined as premiums exceeding $10,200 for singles and $27,500 for families). Some women want or need higher-cost plans due to chronic health conditions, growing families or other essential health care needs. As women and their families get older, their health insurance costs tend to rise. This is particularly true of women who are retired but not yet eligible for Medicare. To tax women who have the highest health care costs is a cruel double blow.
The third Obamacare tax increase on women is the “medicine cabinet tax.” This tax hike on women is already in effect. Since January of 2011, women have not been able to purchase non-prescription, over-the-counter medicines from their flex-spending accounts or health savings accounts. Women rely on over-the-counter medicines to get themselves and their families through the colds, fevers and aches and pains of daily family life. How does making arthritis pills and children’s pain relief medicines after-tax expenditures improve our health care system? To raise taxes on busy moms and working women running to the pharmacy makes absolutely no sense.
Related to the medicine cabinet tax is a new cap on flexible spending accounts (FSAs). Starting in 2013, the amount that working women and their families can put into these workplace “flex accounts” will be capped at $2,500 per worker. Like the medicine cabinet tax, this arbitrary middle class tax hike will be most seen by the primary health care consumers for most families — women. For many families, some out-of-pocket health care costs will no longer be pre-tax. This will be particularly cruel for families with special needs children, who have high out-of-pocket medical costs and often use pre-tax flex accounts to ease the burden for them.
The fifth and final Obamacare tax that disproportionately penalizes women is on, of all things, tanning salon sessions. This is another tax increase which has already taken effect, in July of 2010. Since then, Obamacare has imposed a 10% excise tax on tanning bed sessions. According to that industry, the majority of tanning salon owners are female entrepreneurs. The majority of customers of tanning salons are women. Women should not be targeted in this way by Obamacare or the tax code. The tanning tax should be repealed.
Obamacare’s tax war on women needs to be repealed.
Grover Norquist is president of Americans for Tax Reform and co-author (with John Lott) of Debacle: Obama’s War on Jobs and Growth and What We Can Do Now to Regain Our Future.