Clinton proposes new tax to pay for healthcare, education

Hillary Clinton plans to offset the costs of her healthcare and education proposals with a 3.8 percent surtax on investment income and wages for high earners, her campaign told the Committee for a Responsible Federal Budget. 

The 3.8 percent surtax applies to capital gains, dividends and interest, as well as wages for individuals who earn above $200,000 and couples who earn above $250,000, according to the report. Some pass-through business income will be exempt, but Ms. Clinton plans to adopt a proposal from the fiscal 2017 budget that would make the tax applicable to owners' income from S-corporations, limited partners and limited liability corporations. 

The Joint Committee on Taxation determined that these provisions would generate about $235 billion over the next 10 years, according to CRFB. The revenue generated by the tax would be used in part to offset the costs of her newly added healthcare proposals, which include allowing Americans ages 55 to 64 to buy into Medicare, increase funding for Federally Qualified Health Centers and triple funding for the National Health Service Corps. 

Because this tax would offset the costs of her additional proposals, the CRFB said it is not adjusting its estimate that her plans would add $250 billion to the federal debt. 

 

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