Just one of Obamacare’s many taxes could cost the U.S. hundreds of thousands of jobs over the next decade, according to an industry report published Tuesday.
The National Federation of Independent Business projects that between 152,000 and 286,000 jobs will be lost by 2023 due to Obamacare’s health insurance tax. NFIB, a nonprofit association of business owners, actively supports the repeal of the tax.
The health insurance tax has proved to be one of Obamacare’s more controversial fundraising measures. The tax targets insurance companies, charging each one proportional to their market share — the more health plans sold, as is Obamacare’s goal, the more insurers are required to pay.
The report found that the tax will cause a spike in the cost of employer-sponsored health coverage, which will lead primarily small businesses to cut jobs. NFIB estimates that 57 percent of the job losses will come from small businesses — firms with under 500 employees, according to the federal Small Business Administration.
The cut in employment would results in a reduction of U.S. real output, or sales, of between $20 billion and $33 billion through 2023.
Obamacare’s health insurance tax “represents a new tax on small business that raises insurance costs for an already struggling Main Street and is contrary to the goals of health care reform,” said NFIB’s Amanda Austin, the director of federal public policy. “Singling out job creators for tax increases makes no sense for our economy, is short-sighted and wrong for our nation’s growth.”
Some states will be disproportionately affected by the projected job losses. California will be hit the hardest, suffering 23,00 jobs lost by 2023 and a lost $4 billion in sales for small businesses, according to the report.
Texas should expect to lose 14,500 jobs by 2023 due to the tax, and duly $2.5 billion in small business sales; Florida is projected to lose 9,700 jobs and $1.2 in small business sales; and in Illinois, 5,500 job lost and $1 billion in small business sales.
The federal government expects to collect $8 billion from the tax in 2014, $11.3 billion in 2015, with the pot growing to $14.3 billion by 2018. While the Obama administration may have intended for the tax to take a hit at insurers’ profits, the cost of the tax will likely be passed along to those purchasing the plans — which in the vast majority of cases are employers.
The American Action Forum, a Washington-based free-market think tank, estimates that the health insurance tax will add $101 onto customers’ premiums in 2014 and $143 in 2015 and 2016. (RELATED: Obamacare taxes add billions to rising premiums)Facebook, Google Plus, & Twitter. You can also get Freedom Outpost delivered to your Amazon Kindle device here.