Washington DC - Ways and Means Committee Republicans today voted for legislation that would raise taxes on middle-income families. H.R. 705, the Comprehensive 1099 Taxpayer Protection and Repayment of Exchange Subsidy Overpayments Act of 2011, would repeal the 1099 reporting requirement by forcing low- and middle-income Americans to pay the IRS billions of dollars in increased taxes -- money that these families never personally received, but that was paid directly to health insurers to cover portions of health care costs. In July, 2010 House Democrats voted to repeal 1099 in a revenue-neutral way and all Republicans voted no.
By rejecting an amendment offered by Rep. Joe Crowley (D-NY) that would repeal the middle class tax increase proposed in their bill, the Republicans have already gone back on the “Americans for Tax Reform" pledge to not raise taxes.
Ranking Member Sander M. Levin (D-MI): “This is a tax increase plain and simple. Republicans are proposing to pay for 1099 repeal on the backs of middle-income families. They can dance around the issue all they want, but it is clear as day that this would raise taxes."
Rep. Joe Crowley (D-NY): “The bottom line is a promotion, bonus or raise should be a boon for American families, not a burden. Unfortunately, Republicans want to penalize middle-class Americans for their hard work by raising their taxes or forcing them to opt out of health insurance coverage for their families. By voting down this amendment, Republicans have placed a high price tag on what is essentially a pat on the back for hard working Americans."
Health Ranking Member Pete Stark (D-CA): "The Republicans would eliminate the responsible, bipartisan protections we enacted that would protect middle class families from the danger of extreme tax increases. Their policy institutes steep cliffs as a way to shake $25 billion from the pockets of middle class families."
Rep. Charles Rangel (D-NY): "It's ironic that the Republicans want to claim credit for the repeal that they previously voted against, and are now trying to tax people who cannot afford health insurance."
Trade Ranking Member Jim McDermott (D-WA): “The Republican proposed pay-for is unacceptable - health care costs will rise substantially for the middle class and leave over a quarter million Americans uninsured. It will create an unexpected and severe tax increase for those who are lucky enough to find employment or see a pay increase during the year. I want to be clear, this pay-for is a direct attack on the middle class. Instead, we should pay for it by closing corporate tax loopholes that shift billions of dollars and thousands of jobs overseas. That is sound tax policy that our Republican colleagues should agree with: bringing jobs back home and promoting free market competition."
Oversight Ranking Member John Lewis (D-GA): “I agree that small businesses in America need to be freed from the burden of needless paperwork, so they can spend more time growing their businesses. That is good for our economy, so I have long supported the repeal of the 1099 provision. However the revenue lost by repealing 1099 has to be regained from somewhere, so we’re not adding to the deficit. I do not support the way this repeal will be paid for in this version of the bill. Essentially, we gave people a tax break to help them afford health insurance, but once they buy insurance, get a raise or take on a few side jobs to earn more income, they are penalized for even the smallest success, by having to repay the subsidy. That’s not fair."
Select Revenue Measures Ranking Member Richard E. Neal (D-MA): “While House Republicans led the effort to give a tax cut to millionaires, they are now proposing a tax increase on middle income Americans. If public policy is a reflection of our values and principles, it is clear that the Republican Party is not on the side of hard working families. I don’t believe we should be penalizing people who are trying to pay for their health insurance, and that is why I will continue to support the Affordable Care Act."
Democratic Caucus Chair John Larson (D-CT): This Republican tax hike would penalize middle class Americans who sought affordable health insurance for their families, did everything they were supposed to, and had the tenacity to be hired or get a raise. It unfairly hurts low- and middle-income families who are seeking affordable health insurance and greater opportunity.
Rep. Earl Blumenauer (D-OR): “I am pleased to reiterate my vote to repeal of the 1099 reporting requirement, which threatens to hurt small businesses in Oregon. My Democratic colleagues and I also voted to repeal this measure last year in a responsible manner. Today, it saddens me that my Republican colleagues chose to repeal the requirement in a way that hurts middle class families who are struggling to make ends meet."
Rep. Ron Kind (D-WI): “Under the Republican proposal, middle-income families will be forced to pay thousands of dollars in increased taxes instead of using that money to pay for health insurance for their families. This is unacceptable and a choice no family should have to make. Rep. Crowley’s amendment protects these families. Middle Class families can’t afford a tax increase and they surely cannot afford up to $12,000 in taxes that the Republican proposal could impose."
Rep. Bill Pascrell (D-NJ): “We should repeal the 1099 reporting requirement, but not on the backs of working class Americans. Under the Majority’s pay-for today, not only does a middle class individual’s tax liability increase, but so do the general costs to the rest of the society who will have to shoulder the health costs of these uninsured Americans."
Rep. Shelley Berkley (D-NV): “While I support repealing this 1099 provision, I do not believe we should pay for it by targeting more than 250,000 Americans with a tax increase. This change threatens working families with having to pay $2000, $3000, $4,000 or more out of their own pockets to cover added health insurance costs. Rather than making health coverage more affordable for families in Nevada and nationwide, the provision I oppose threatens to punish middle-class earners who suddenly see an increase in their paychecks as a result of a new job, bonus or raise. Changing these caps is the wrong way to pay for this legislation and those most affected will be low-income and middle-wage earners already struggling to make ends meet in our down economy."
