As Vice President, Joe Biden broke his promise to the middle class that no one making less than $250,000 would see a single penny of their tax raised. Biden said his tax vow applied to “any tax.”
Biden made the promise during a nationally televised Vice Presidential debate on Oct. 3, 2008 using firm language:
“No one making less than $250,000 under Barack Obama’s plan will see one single penny of their tax raised whether it’s their capital gains tax, their income tax, investment tax, any tax.” [Video]
Once elected, Biden immediately pushed for tax increases on millions of middle class households. When Obamacare was signed into law with Biden’s support, it imposed a series of middle class tax hikes including the individual mandate tax, new taxes on households with health savings accounts and flexible spending accounts, and an income tax hike on Americans facing high medical bills:
Individual Mandate Tax: Obamacare imposed a tax penalty of $695 for an individual and $2,085 for a family of four for failing to buy “qualifying” health insurance as defined by Obama-Biden rules.
The tax hit low and middle-income families hard: 76.86% of households stuck paying the tax made less than $50,000 per year, a blatant violation of Biden’s pledge to the American people. (Thanks to the GOP congress and President Trump, this tax was zeroed out as part of the Tax Cuts and Jobs Act.)
Medicine Cabinet Tax on health Savings Accounts and Flexible Spending Accounts: Because of Obamacare, the 20 million Americans with a Health Savings Account and the 30 to 35 million Americans with a Flexible Spending Account are no longer able to purchase over-the-counter medicines using these pre-tax account funds. Examples include cold, cough, and flu medicine, menstrual cramp relief medication, allergy medicines, and dozens of other common medicine cabinet health items.
Chronic Care Income Tax Hike: This income tax increase directly targets middle class Americans who happen to face high medical and dental bills in a given year. This Obamacare tax hit 10 million households per year. Before Obamacare, Americans facing high medical expenses were allowed an income tax deduction to the extent that those expenses exceeded 7.5 percent of adjusted gross income (AGI). Obamacare imposed a threshold of 10 percent of AGI. Therefore, Biden not only made it more difficult to claim this deduction, he widened the net of taxable income.
Again, low and middle income households were hit hard by this tax. On average, affected taxpayers earned about $53,000 annually. ATR estimates the average income tax increase for the average affected household amounted to $200 – $400 per year.
Flexible Spending Account Tax: The 30 – 35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs face an Obamacare-imposed cap of $2,500.
Before Obamacare, the accounts were unlimited under federal law. But now, parents looking to save for medical costs or braces for the kids find themselves quickly hitting this new cap. This restricts the options for low and middle income families.
There is one group of flexible spending account households for whom this tax is particularly cruel and onerous: parents of special needs children. Families with special needs children often use FSAs to pay for special needs education. Tuition and book costs at special needs schools can run thousands of dollars per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education.This Obama-Biden tax increase limits the options available to these families.
For breaking his middle class tax pledge, Joe Biden has some explaining to do.
“Joe Biden, when running for Vice President in 2008, lied to the American people when he said he and Obama would never raise any tax on any American earning less than $250,000. Now he is running for president. Whatever he says, taxpayers now know what to expect,” said Grover Norquist, president of Americans for Tax Reform.
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