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Monday, April 15, 2024

GOP deficit plan: Limit deductions, tax health insurance


Rep. Pat Toomey: Treading in dangerous watersRepublicans are looking at limiting deductions for mortgage interest, charitable donations and other traditional areas as well as taxing employer-provided health benefits as ways to raise taxes without calling it a tax increase.

The plan, floated by Rep. Pat Toomey of the 12-member “super committee” is spurring considerable debate within both committee meetings and the GOP caucuses on Capitol Hill.

Some Republicans feel the plan violates the party’s promise to hold the line on taxes but others say it is not a tax increase, per se, but simply a revamping of the current tax code.

Still others call it smoke and mirrors.

“It’s sham politics,” one GOP insider tells Capitol Hill Blue.

House Speaker John Boehner appears to favor the plan. House Majority Leader Eric Cantor does not.  It’s a safe bet the tea party that backs Cantor will not either.

Toomey’s plan calls for lower tax rates in exchange for stricter limits on itemized deducations.

The plan is already drawing fire from special interest groups like the giant National Association of Realtors, which considers mortgage interest deductability sacred.

A statement from the trade association says it “remains committed to preserving” the mortgage interest deduction, adding that “there could not be a worse time for even considering changes to those incentives.”

Taxing health insurance benefits could blow up on Republicans at a time when they are trying to make President Barack Obama’s health insurance “reform” a major campaign issue in the 2012 election.

“We can’t have it both ways,” grumbles one GOP congressional staff member.


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7 thoughts on “GOP deficit plan: Limit deductions, tax health insurance”

  1. Of course, the best tax break is religion. 100% off.

    The “Crystal Cathedral” near LA is being sold to another church for ~$57 million. And ne’er a penny of tax.

    The Catholic diocese buying it pointed out that it was about four times cheaper than building their own cathedral; i.e., $200 million, and not a penny of tax.

    Somehow I don’t think those tax breaks are going away anytime soon, though.


  2. Let’s take these Republican proposals one at a time:

    1) Limit mortgage deductions: What a slam against the old mantra about promoting the American dream of the aspiring upwardly mobile house renter to own their own home. As Woody notes, this results in less spendable income needed to stimulate the economy.

    2) Limiting charitable donations: This flies the the face of the Republican pillar of wisdom that the good hearts of Americans in donating to charity can replace the government funding the social safety net. On a personal note, I donated a lot of money to the high school student council and the library in memory of my wife this this year and was able to donate more because I knew it would be tax deductible.

    3) Tax employer health benefits: Supposedly the government has no business legislating a health insurance mandate but they can essentially levy a surcharge on individual health care insurance? This doesn’t even benefit businesses, it is a way to lower the net income of working Americans. That, as Woody says, is spendable income that the economy needs.

  3. I can’t think of a better way to kick the middle class in the teeth while they are down. Someday perhaps they will realize that the rich do not create jobs, demand for products and services does. Demand that is generated by an affluent middle class.

    I guess it’s only class warfare when the 99% fight back. ¡Viva la Revolución!

  4. Big surprise: Republicans are not opposed to raising taxes, as long as the rich get a tax cut in the process!

  5. Yea, don’t tax the 1%, but raise taxes on the 99% and stick it to the middle class. Anybody not understand why voting for a Republican is like begging a thief not to take you silver.

  6. This confirms my belief that the the ‘rethugs’ don’t have their oars in the water.

    Notice neither side of the aisle is for pulling the plug on our uber expensive and wasteful military adventurism on a worldwide basis including our obviously failed thirty year ‘war on drugs’.

    The MIC gods as well as bankers of the same stripe must be coddled and exalted while John and Mary Q. Public gets screwed over again and again as always.

    Wut a bunch of slugs…!

    Carl Nemo **==

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