While the Republican plan to overhaul Obamacare appeals to be going through some last-minute tweaks, it’s almost certain that its changes will include lower taxes for the wealthy. You’ve probably heard that already — but with the plan’s complicated mix of different tax cuts, plus credits to help consumers buy insurance, it can be hard to see how big the tax cuts would be.
This graphic, published Wednesday by the Tax Policy Center, a nonpartisan think tank, shows what’s at stake for the rich — and for the rest of us.
On average, taxpayers with annual income of $75,000 or more would come out ahead in this analysis, but it’s those making $200,000 or more who see the greatest payoff.
So what makes it shake out that way?
The Republican plan, dubbed the American Health Care Act, repeals two hefty taxes imposed by the Obama administration to help subsidize care for lower-income Americans: a 3.8% surcharge on investment income, such as capital gains and dividends, and an extra 0.9% added to Medicare payroll taxes.
Those at the low end of the income spectrum would benefit from new tax credits in the Republican plan, the Tax Policy Center found, but these credits would not be generous enough to offset cuts to their Medicaid benefits.
One thing the chart doesn’t show: how the richest of the rich would fare.
According to the same analysis, those earning more than $1 million a year would see a tax cut of $51,400 a year, on average. That figure accounts for 46% of tax savings for all taxpayers, according to the Tax Policy Center.
Of course, nothing is carved in stone. The Republican bill, which the House could vote on as soon as Thursday, may be altered significantly in order to attract more votes. But given the fact that tax cuts were a key element of Republicans’ Obamacare repeal efforts, it seems unlikely at least at this point that the basic dynamic of the final bill be dramatically different.