U.S. health care tax on ex-pats unlikely to pass, say accountants
By Raphael Ahren
Tags: U.S. healthcare tax
A controversial clause in the U.S. healthcare overhaul, charging Americans living abroad a $750 annual tax for insurance they might never use, is unlikely to pass, said local accountants and activists yesterday.
On Tuesday, Americans in Israel were up in arms about the clause, as the Associations of Americans and Canadians in Israel called on people to protest the bill, which is being discussed in the Senate as part of U.S. President Barack Obama's health care reform.
Under the current formulation of the Senate bill, every American who doesn't buy into a health care plan in the United States would be charged an annual $750 excise tax.
The copy of the bill passed by the House of Representatives excludes citizens living overseas. However, some people fear the merged bill may wind up including the tax.
AACI wants to see the Senate include the same exemption as the House of Representatives, explained Yitzhak Heimowitz, a member of AACI's legal commission.
"If that doesn't work, it's not too late, because in the conference committee [merging the two chambers' bills] efforts can still be made to change the Senate version. There is quite a good chance that the bill would be changed."
"In the House bill, the excise tax was squashed and I am assuming it will be squashed in the Senate too," said Joanne Yaron, chairwoman of Democrats Abroad-Israel. It was due to Democrats Abroad that the House removed the tax from its bill, she said.
"We have people who are very close to the issue and keeping their eyes open," Yaron said. "If something like that gets into the [Senate] bill, I am fairly certain they will come forward again and point out the reasons why it can't be levied on oversea Americans. It simply wouldn't be fair."
"It just doesn't seem possible that the bill would pass with an excise tax," she continued. "Even if the bill isn't squashed in the Senate, it would then get to the president's desk, and I don't think he'd accept it."
However, that doesn't mean Americans in Israel should sit by passively, she said. "I don't think it's a bad idea writing to your senators," she said, referring to AACI's initiative. "I may write to mine."