White House open to new tax on health benefits
President Obama campaigned against raising on middle-class families
updated 3:56 p.m. ET, Sun., June 28, 2009
function UpdateTimeStamp(pdt) {
var n = document.getElementById("udtD");
if(pdt != '' && n && window.DateTime) {
var dt = new DateTime();
pdt = dt.T2D(pdt);
if(dt.GetTZ(pdt)) {n.innerHTML = dt.D2S(pdt,((''.toLowerCase()=='false')?false:true));}
}
}
UpdateTimeStamp('633818158108530000');
WASHINGTON
- The White House left open the possibility Sunday that President
Barack Obama might pay for his health care overhaul by taxing
employer-provided health insurance even though he had campaigned on not
raising taxes on middle-class families.
White
House adviser David Axelrod said the administration wouldn't rule out
taxing some employees' benefits to fund a health care agenda that has
yet to take final form. The move would be a compromise with fellow
Democrats, who are pushing the proposal as a way to pay for the massive
undertaking without ballooning the federal deficit.
"There
are a number of formulations and we'll wait and see. The important
thing at this point is to keep the process moving, to keep people at
the table, to the keep the discussions going," Axelrod said. "We've
gotten a long way down the road and we want to finish that journey."
But if Obama compromises on that point, it would reverse his promise not to raise taxes on those earning less than $250,000.
"I
pledge that under my plan, no one making less than $250,000 a year will
see any type of tax increase," Obama told a crowd in Dover, N.H., last
year. "Not income tax, not capital gains taxes, not any kind of tax."
Only those with pricey plans affected
At
the time, his Republican rival, Sen. John McCain, R-Ariz., was
proposing a tax on health benefits similar to one Obama is being handed
by Congress.
A
tax on health benefits would affect only those with pricey health
plans. The idea would be to tax as income the portion of health
benefits worth more than a specified limit. Officials are considering
several options, including one that would set the limit at $17,240 for
family coverage and $6,800 for individuals.
Plans worth more than that would be taxed; those worth less would see no increase.
Obama
has faced similar criticism before. When he increased taxes on tobacco
to pay for a children's health bill, his critics said he was raising
taxes on those making less than $250,000 a year.
Obama
left open the possibility of a tax during interviews last week,
insisting he wasn't taking any option off the table despite his
personal opposition. But two of his high-profile advisers — budget
chief Peter Orszag and economic adviser Jason Furman — both have
indicated they support some taxes on health benefits to pay for the
overhaul.
Sen.
Chuck Grassley, R-Iowa, said that Obama should step in an oppose the
tax if he's truly against it. Otherwise, he faces a loss to his own
Democratic Party and his own campaign credibility.
"I
think it's going to take presidential leadership to get people of his
party to see that we shouldn't be subsidizing high-end health insurance
policies that drive up inflation in health insurance," said Grassley,
the top Republican on the powerful finance committee.
'People draw lines in the sand'
Grassley — and, to be sure, other Republicans — remember Obama's scathing criticism of their GOP presidential nominee.
"Since
the president denigrated John McCain's effort to move in this direction
during the campaign, it's going to take, in order to win over
Republicans, presidential leadership in that direction," Grassley said.
Click for related content
Axelrod
insisted that the White House has made progress on a health care plan
and is working with Congress. Even so, the emerging legislation is
hardly the bipartisan collaboration Obama's top advisers had sought.
"One
of the problems we've had in this town is that people draw lines in the
sand and they stop talking to each other," Axelrod said. "And you don't
get anything done. That's not the way the president approaches us."
Axelrod appeared on ABC's "This Week" and NBC's "Meet the Press." Grassley appeared on "This Week."