Risky Mix: Cutting Taxes For Rich and Aid for Poor

In Taxes On
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WASHINGTON — The tough lessons are piling up for Republicans as they struggle to repeal the Affordable Care Act, but one stands out as a harbinger of things to come: Tax cuts for the rich, paired with reduced services for the poor, are a politically unpalatable combination.

Unable to get the first version of their health care bill off the ground, Senate Republicans are expected to release a revised bill on Thursday that would keep two of the taxes on the wealthy that were imposed by President Barack Obama’s health law: the 3.8 percent tax on investment income and the 0.9 percent surcharge on Medicare taxes, both imposed on high-income earners.

Republicans have long said that these taxes are killing jobs and strangling economic growth, but the juxtaposition of repealing hundreds of billions of dollars in taxes for the wealthy and cutting deeply into Medicaid has become untenable.

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