Politico: Scott would see big tax savings under Obamacare repeal
Scott’s political advisers would neither confirm nor deny the Obamacare taxes he paid in those two years. (AP Photo)
By Marc Caputo
Florida Gov. Rick Scott is urging Congress to keep trying to repeal Obamacare, but he’s not mentioning the personal benefit he would derive: a wind-fall tax cut of anywhere from $250,000 to $500,000.
After Republicans failed to wipe out Obamacare the first time, Scott penned a USA To-day op-ed last week that called on lawmakers to pass a plan “that actually provides afford-able and quality health care for families.”
“Remove Obamacare’s excessive mandates and taxes … NOW,” Scott demanded.
Unsaid by Scott: Such a repeal would have saved him exactly $246,109, according to his tax filing for 2013. That was the first year the Affordable Care Act imposed a “net investment income tax” on those families who earn more than $250,000 from investments, which accounted for Scott’s $8.2 million income in 2013. Scott would not release his tax filings for 2014 or 2015, so it’s unclear how much he paid in net in-vestment income tax in those years.
Scott could have paid about $297,000 on his roughly $9.8 million income in 2014 and $503,000 on almost $16.6 mil-lion in 2015, accounting for standard deductions and the net investment income tax rate of 3.8 percent applied to his re-ported investment income in state financial disclosures he filed. Scott’s political advisers would neither confirm nor deny the Obamacare taxes he paid in those two years. Scott’s 2016 taxes and state financial dis-closure forms have yet to be filed.
A critic of Hillary Clinton’s failed healthcare proposal in the 1990s and Obama’s plan starting in 2009, Scott said his opposition to Obamacare revolves around improving the health system. He said he’s opposed to tax increases as a matter of general principle.
“I don’t believe in raising any taxes. I believe we’ve got to reduce the cost of government,” Scott told POLITICO Florida when asked about his potential savings if Obamacare’s taxes were completely repealed. “We’ve cut taxes 55 times since I got elected — $6.5 billion. So I’m going to continue to work to do everything I can to get taxes lower, not higher.”
Asked if he had personal financial motives, Scott said “no.”
Does he have enough money? “I’m focused on getting more jobs,” Scott — who foregoes his $130,273 annual state salary — replied with a laugh.
In his USA Today op-ed last week, Scott also called on Congress to allow insurance to be sold across state lines “to encourage competition” and there-by lower costs. He added that he wants to “protect those with pre-existing conditions and let young adults stay on their parents’ plans until they turn 26.”
This would allow families to buy the health insurance they want, Scott wrote.
He also pointed out that health insurance premiums are rising and that Obama told PolitiFact’s “lie of the year” by saying people could keep the doctors and plans they wanted.
But Obamacare backers say criticisms such as Scott’s undervalue the total benefits of the Affordable Care Act, which helped bend the cost curve of healthcare price increases and significantly decreased the number of those without coverage — especially in states like Florida, which has historically had one of the highest rates of uninsured amid Republican control of the Legislature and governor’s mansion since 1999.
Florida would have a lower uninsured rate due to the ACA, but Scott and the GOP-led Legislature refused to expand Medicaid. That left an estimated 800,000 Floridians in a “coverage gap” where they can’t qualify for subsidized health insurance under the law.
Even if Congress doesn’t take up a version of its now-failed American Healthcare Act to repeal and replace Obamacare, there’s a chance lawmakers will still try to reduce the taxes if they overhaul the tax system.
The two major Obamacare taxes on the rich — the investment tax and an additional wage tax — also helped increase the real income of the bottom 10 percent of Americans, while slightly blunting the financial gains of the top 1 percent, said Timothy Jost, an Obamacare expert with Washington and Lee University School of Law. He said he derived the data on Obamacare’s successes from a White House Council of Economic Advisors 2016 report that the Trump Administration promptly removed from the web.
Jost said the now-failed congressional Republican plan to repeal and replace Obamacare would have kept many of the Affordable Care Act’s provisions in place, but reduced the number of the insured while cutting $880 billion from Medicaid over a decade and canceling the Obamacare taxes worth $883 billion over 10 years. About 4 million people last year paid the two taxes that together raised about $27 billion.
“What the bill did was take money going to poor people and gives it back to rich people. What this bill was all about was tax cuts,” he said. He added that he’s a member of a LISTSERV with a variety of health policy experts who span the political spectrum, and none could defend the main thrust of the bill.
“Why isn’t this being sold as a giant tax giveaway?” he said he asked. “And there was just silence. The argument normally about tax cuts is, ‘Well, if you give rich people more money, they’ll take it and invest it and it will trickle down eventually to poor people.’ They’re not trying to make that argument. But it’s people like Scott who will go to the bank over this.”
Citing a study from the liberal Center on Budget Policy and Priorities, Jost said that just 400 of the richest Americans pay an average of about $7 million annually in Obamacare taxes — far more than Scott — that help subsidize health insurance for 813,000 people.
Alan Cole, an analyst with the right-leaning Tax Foundation, said the Affordable Care Act doesn’t just redistribute wealth from rich to poor. Because it requires all to get covered — including young and healthy people who don’t need insurance immediately — it also provides a benefit to the sick and old.
Too many conservatives, Cole said, the redistribution of wealth and raising taxes is a nonstarter because they believe people should make their own choices about their own finances. “There’s an inherent skepticism about people’s efficiency when they’re spending other people’s money,” he said, noting that all big programs also have waste, including Obamacare.
Echoing that point, Scott’s top political adviser, Curt Anderson, said the governor’s opposition to Obamacare was about his views of government — not his concerns about his bank account: “To suggest that the Governor’s opposition to Obamacare has some bizarre connection to his personal finances is a complete joke.”
Still, it’s serious money in a state where the median household income is less than $50,000.