Politics

Cruz Follows Trump’s Lead, Wants To Pay For Tax Cuts By Eliminating Obamacare Fine

No featured image available

WASHINGTON, D.C. – Texas Republican Sen. Ted Cruz joined President Donald Trump Tuesday in advocating for the repeal of a central element of Obamacare as part of the GOP tax reform bill.

Cruz called for a repeal of the Obamacare individual mandate, a tax levied against Americans who choose not to purchase health insurance, during a press conference on tax reform hosted by the National Tax Payers Union.

Cruz emphasized the potential of repealing the individual mandate in offsetting lost revenue from tax cuts, citing a CBO report that suggested eliminating the tax will save the government roughly $400 billion over the next 10 years.

“In the House and the Senate we need to do even more to provide a tax cut, not a tax incentive but a tax cut, for every American, to working men and women. I think there is a path forward, which actually the President laid out last week, which is repealing the individual mandate, the IRS tax from Obamacare,” Cruz said. “Here’s the silver lining for tax reform. The CBO scores that repeal as saving over 400 billion dollars, all of which I believe should be put into lowering taxes for individuals.”

The Texas conservative lauded his Republican colleagues in the House for putting forward a draft bill, which he believes can serve as a good starting point, but he criticized the lawmakers’ insistence on cutting exemptions to pay for the ambitious rate cuts promised by GOP leadership.

The House draft, announced Thursday, eliminates the state and local tax exemption (SALT) in an effort to offset across the board rate cuts, a measure that will likely leave many middle class families in high tax states paying more in taxes overall.

Cruz said he believes eliminating that deduction is “a mistake” because the goal of the legislation is to leave more money in the pocket of every American.

GOP Sen. David Perdue of Georgia challenged this notion in comments made to reporters following the presser. Perdue said he believes it’s unfair that two families with the same income pay a different amount in federal taxes depending on where they live.

“We’re trying to create a level playing field. It’s outrageous to me that a couple with two kids, the same couple with two kids, same income, same expenses and everything in California and Iowa, the peopl in Iowa pay more in federal income taxes, that’s not right,” Perdue told reporters.

Perdue’s language echoes that of Republican leaders, who have defended the SALT repeal through appeals to fairness. Key Republican lawmakers involved in the tax reform effort, including House Ways and Means Committee Chair Kevin Brady, have argued the SALT exemption rewards the people of one state at the expense of their fellow Americans in other parts of the country where state and local taxes might be lower.

Cruz’s emphasis on tying Obamacare repeal to the tax reform bill is however in keeping with the President Donald Trump’s priorities.

Trump has called for the elimination of the individual mandate in numerous phone calls with Brady.

“The president feels very strongly about including this at some step before the final process,” Brady said at a Friday event hosted by Politico. “He’s told me that twice by phone and once in person.”

Brady expressed trepidation about complicating the already ambitious tax reform effort by introducing such a dramatic measure.

“Importing health care into the tax reform debate has consequences, especially when the Senate has yet to produce 50 votes on anything related to health care that I’m aware of,” Brady said at the Friday event. “Clearly you’re bringing a whole new element into pro-growth tax reform.”

Brady’s concerns regarding the political implications of including individual mandate repeal in the bill are reportedly shared by many of his colleagues, some of whom told The Washington Post they are concerned the move could spark the kind of enthusiastic opposition Republicans faced in tryin to repeal Obamacare.

Cruz was isolated in his support for Trump’s position during the Tuesday press conference. The 10 conservative lawmakers who joined him at the press conference avoided any mention of repealing the individual mandate.

Cruz, spoke confidently about the implications of individual mandate repeal for low and moderate income Americans, who he argues, are being unfairly targeted.

“Each year the IRS fines about 6 million people because they don’t have enough money to afford health care. Roughly 80 percent of the people getting fined by the IRS make $50,000 or less, roughly 40 percent make $25,000 a year or less,” Cruz asserted.

“You got a single mom who’s working trying to make ends meet. She doesn’t have enough money to purchase health insurance because Obamacare has driven health insurance through the roof and on top of that the IRS fines her because she doesn’t have enough money to purchase health insurance, that is profoundly unfair. We need to repeal that.”

Follow Jack on Twitter