New Health Care Law Hits Lowest Earners The Hardest

New Health Care Law Hits Lowest Earners The Hardest

According to a recent Forbes article, the new Affordable Health Care Act will affect the lowest wage earners the most. “Obamacare levies a grossly unfair tax on workers in large firms – a tax that is particularly unfair since it hits those with the lowest wages hardest,” the article states. Research numbers calculated by the Urban Institute support this argument.

“…Careful calculations by researchers at the Urban Institute have shown that a small firm worker in a family of 4 earning a poverty-level wage ($24,000) who will be eligible to purchase coverage through the exchange will get a tax-paid subsidy of $18,432. This includes a premium subsidy of $13,598 (leaving the employee responsible for paying $502, which is just over 2% of family income) and an additional subsidy of $4,834 (leaving the employee responsible for $166).[1]  An equivalently-compensated worker working for a large firm who obtains the identical health plan through his employer would receive no tax subsidy whatsoever. In fact, due to the peculiarities of the Earned Income Tax Credit (EITC), that worker actually would end up paying $123 more in federal taxes than his small firm counterpart who receives no employer-provided health benefits whatsoever![2]”

 

Click here to read the full Forbes article. 

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