-A tax on prescription drugs will raise another $27 billion.
The Republican staff of the Senate Finance committee estimates that these three taxes alone will ultimately push up health insurance premiums for a typical family of four by about $1,000 a year.
A tax on tanning salons is already collecting revenues from ordinary folks. Because of new restrictions on the use of medical accounts (Health Savings Accounts, Health Reimbursement Arrangements, and Flexible Spending Accounts), people are now paying more for such over-the-counter items as Claritin, aspirin and Advil. All told, "medicine cabinet" taxes are expected to raise about $45 billion over the next ten years.
Then there is the tax on sickness. Right now, people can deduct medical expenses in excess of 7.5 percent of their income. That figure will soon rise to 10 percent. Families who have the misfortune of incurring high medical bills will have to pay more to Uncle Sam as a result.
Pity the elderly and the disabled. More than half the cost of the health reform bill will be paid for by reduced spending on Medicare — a whopping $523 billion reduction over the next ten years. Although this is technically a spending reduction rather than a tax increase, the economic impact is the same.
Medicare’s chief Actuary predicts that in eight more years, Medicare will be paying doctors and hospitals less than what Medicaid (for poor people) pays. If so, senior citizens will be lined up behind welfare mothers, seeking care at community health centers and at the emergency rooms of safety net hospitals.
Will seniors be able to survive by paying more out of pocket to offset the reduction in Medicare spending? Maybe. But if they do so, it’s going to them 10 percent of their Social Security checks within eight years.
Here’s the bottom line: when President Obama talks taxes on the rich, expect even more taxes on the middle class.
But what about the rich? Is the president really going to sock it to his friends and golfing buddies?
Would you believe that under the president’s higher-taxes-on-the-rich proposals most of Warren Buffett’s income won’t be taxed at all. More on that in a future column.