Republicans and Conservatives are at Odds Over Taxes in Obamacare Replacement Bill

In 2010, 2012, 2014, and 2016, the American people elected Republicans to Congress with a clear mandate: repeal and replace Obamacare. Yet somehow the GOP has managed to do little more than propose watered-down versions of the health care legislation that citizens so desperately want replaced.

As the Senate hammers out their version of Obamacare replacement, there’s one sticking point that is making the negotiations more difficult – taxes.

Specifically, senators are divided over the inclusion of Obamacare’s 3.8 percent net investment income tax. Conservatives want the tax repealed, while more moderate Republicans are fine with keeping the tax as a way to help fund health care for those with lower incomes.

Some in the Senate emphasize the importance of keeping the tax embedded in the new legislation:

“We [want to] address the issue of ensuring lower-income citizens are in a position to buy plans that are actually provide them appropriate healthcare,” Sen. Bob Corker (R-Tenn.) told reporters last week.

While other members of Congress understand a need to keep the tax in place whether they like it or not.

“Our official position is we want to repeal all the taxes. That being said, we understand the logistics of having to have enough revenue,” House Freedom Caucus Chairman Mark Meadows (R-N.C.) said. “And so I’m not at this point closing that off to negotiations because I think it would be premature to do that.”

Sen. Ron Johnson (R-Wis.) told his constituents in a telephone town hall last week that he’s “personally not opposed” to keeping ObamaCare taxes to pay for health benefits.

On the other end of the spectrum are taxpayer advocacy groups who are adamantly opposed to the tax remaining in any GOP replacement.

“Cutting the capital gains tax gets you growth,” said Americans for Tax Reform President Grover Norquist. He called keeping the investment tax an “economically illiterate bad idea.”

Taxpayers Protection Alliance President David Williams said that failing to repeal the investment tax would cause investors to delay selling assets and would “discourage more entry into the stock market.”

So many questions remain. Can the GOP create a replacement that will keep taxes low while still allowing the poor to have more options? Will they proceed with or without the tax in place? Will they scrap Obamacare altogether and create something new? Is a free market solution possible at this point?

But the biggest question of all that is yet to be answered is this one: will the Republicans keep the promises they’ve made to the voters time and time again to repeal and replace Barack Obama’s signature domestic accomplishment?

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Chris Queen

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