The President Health Proposal: Taxing Investment Income

Kathryn Nix / February 25, 2010

In preparation for today’s bipartisan Health Care Summit, President Obama released his own version of health care reform earlier this week.  The President’s proposal includes several high-ticket provisions for expanding coverage.  Since he has promised time and again not to raise taxes on the middle-class in order to pay for health care reform, the President’s bill imposes a Medicare tax on the investment income of high-individuals to off-set some of the cost of expanding Medicaid and  financing other provisions of his health agenda.

But, as Heritage analysts Karen Campbell and Guinevere Nell explain in a recent paper, these new taxes would have widespread adverse effects for all Americans, not just the wealthy that they target.  This is partially due to the very nature of a tax: (more…)