"The Get America Working! approach would work, in effect, by correcting a major price distortion. The current U.S. Internal Revenue Code taxes employment far more heavily than it does the use of natural resources. This distortion has grown progressively worse as payroll taxes have grown. Revising this distortion would increase employment, equity and overall economic vigor importantly. And it would do so by responding to market price signals, not through clumsy and expensive government interventions."
Health Care Reform Should Not Tax Employers
Date:
Wed, 08/05/2009
Source:
Kaufman Foundation
In this COMMENTARY, Jonathan Ortmans says hiking payroll taxes to fund healthcare reform will raise hiring costs and raise unemployment. Like other voices in the health care reform discussion he advises decoupling health insurance and employment.
After all the discussion and effort by Congress and the Administration to introduce a few measures to help small businesses in the recovery, I was alarmed last week to see the House introduce a health care overhaul bill with a measure to punish certain businesses that do not provide health insurance. Companies with payrolls exceeding $400,000 will have to pay a penalty equal to 8% of payroll. Companies with payrolls between $250,000 and $400,000 a year would pay between 6 and 2 percent, and only those with less than $250,000 would be exempt.
