In the middle of his evisceration of the House Republicans’ attack on the Affordable Care Act, MIT’s Jonathan Gruber notes that the attack claims that the ACA’s tax credits are a form of spending.
But…but…but…Saint Grover says that we cannot get rid of any corporate welfare tax credits because that is a tax increase! So wouldn’t the ACA’s tax credits be a form of “tax relief”?
Silly me. Tax credits that support, say, large oil companies are not spending: they are tax relief. Tax credits that increase working families’ capacity to buy health insurance are spending, and are thus wasteful.
Of course it is irrelevant that the ACA’s credits are refundable. All those who receive these credits are working, so they also pay Social Security, Medicare, state, local, and sales taxes. The ACA credits offset those, too, because money is fungible.
So once again: tax credits for corporate welfare, good; tax credits to cover the uninsured, bad.
I’m sure glad we cleared that up.