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The biggest tax increase since…1993?

Marketplace Contributor Jul 2, 2012

The biggest tax increase since…1993?

Marketplace Contributor Jul 2, 2012

Tess Vigeland: From now until Election Day, you can guarantee that politicians will be talking about the Affordable Care Act. The left will celebrate it as history-making legislation. The right will say it’s historic in a totally different way.

Phillip Gingrey: This indeed is the largest tax in the history of our country.

That’s Congressman Phillip Gingrey. Kai interviewed him last week after the Supreme court’s decision to uphold the ACA.

Well, is he right? Is the Affordable Care Act the largest tax in the history of our country? We sent Marketplace’s Shereen Marisol Meraji to find out.

Shereen Marisol Meraji: First off, thank you for not asking me to find out whether the Affordable Care Act is what Rush Limbaugh calls…

Rush Limbaugh: The largest tax increase in the history of the world!

That would be a much tougher assignment. As for the largest increase in U.S. history — tax expert and Northwestern law professor Charlotte Crane says:

Charlotte Crane: Heavens no, I think, by any measure!

And here’s Joseph Thorndike.

Joseph Thorndike: Director of the Tax History Project at Tax Analysts.

He says even after adjusting for inflation…

Thorndike: The Clinton tax hike in ’93 was substantially bigger and the Reagan tax hike of 1982 was really much bigger.

Ed Zelinsky’s a law professor who’s written a lot about health care and says quibbling over whether the Affordable Care Act is the biggest tax increase since Genghis Khan is not the point.

Edward Zelinsky: I think it’s a significant increase, I don’t think it has to be overstated or described hyperbolically to say that it’s an issue worth discussing.

Zelinksy points to the ACA’s tax increase on Americans making $200,000 a year — and the nearly 4 percent tax on their investment income. He says that could affect the way the proverbial 1 percent spends and could hurt the economy. But, Joseph Thorndike of the Tax History Project says it’s simpler just to say:

Thorndike: That this is the biggest tax hike since 1993, which you know, hey that’s a long time ago.

Thorndike says that’s a much more defensible argument than calling the Affordable Care Act the biggest tax increase in American history.

I’m Shereen Marisol Meraji for Marketplace.

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