1-20-14 – Sen. Galbraith Explains Funding for Single Payer (VIDEO)

Sen. Peter Galbraith testified before the Senate Finance Committee on Friday, Jan 17, to explain how his bill (S.252) would pay for Vermont’s single payer healthcare plan, Green Mountain Care (GMC). Galbraith concluded his statement by insisting, “Whatever we do… it will look substantially like this bill. Not because I’m a smart guy, but because there really is no other way to do it.”

Galbraith Video

CLICK to watch video

The funding for a single payer system that needs to raise $1.6 billion in new taxes will come largely ($1.4 billion) from a payroll tax, 11% on the employer and 2% on the employee. $140 million will come from a 10% tax on non-wage income, including capitol gains, dividends, interest, wages earned outside of Vermont. $60 million will come from the elimination of the passthrough of itemized deductions, such as the home mortgage deduction and deductions on charitable giving. The amounts taxed will be capped at $113,000 and $113,600 respectively, the same rates that Social Security caps kick in.

If the cost of Green Mountain Care turns out to be more that $1.6 billion, Galbraith says, “You could adjust the rate [of the payroll tax] up.” Two other analysis of Green Mountain Care, one done by Rutland Treasurer (and EAI board member) Wendy Wilton and another independently commissioned and done by the Avalare Group, show GMC costing between $1.9 and $2.2 billion. Sen. Bob Hartwell pointed out during the testimony that if the larger number is in fact accurate, the combined payroll tax would be 16.25%.

Other points of interest…. Galbraith insisted companies that ensure their employees under federal ERISA laws will not be exempt from the payroll tax — in effect, they will pay twice. Teachers, municipal, and state employees will be “absolutely” included in the plan.

If Vermont decides to choose another funding method for single payer, Galbraith warns we are looking at an income tax with a low bracket of 15% and a high bracket of nearly 25% or an expanded sales tax, including services, clothing, food, etc., at a rate of over 19%. He considers neither option viable.

{ 0 comments… add one now }

Leave a Comment

Previous post:

Next post:

About Us

The Ethan Allen Institute is Vermont’s free-market public policy research and education organization. Founded in 1993, we are one of fifty-plus similar but independent state-level, public policy organizations around the country which exchange ideas and information through the State Policy Network.
Read more...

Latest News

GWSA Passes Out of Energy & Technology Committee

February 14, 2020 by Rob Roper The Global Warming Solutions Act (GWSA) bill passed out of the House Energy & Technology Committee on a 7-2 vote and moved...

VT Childcare Policy: Make it more expensive and less accessible!

February 13, 2020 by Rob Roper The House Education Committee is busy formulating the next steps in what is and has been a long-term, hostile takeover of a...

$200 Million Worth of Climate “Spaghetti”

February 10, 2020 by Rob Roper In a recent interview with VPR, Rep. Tim Briglin (D-Norwich), who chairs the House Energy & Technology Committee, admitted that the state...

Commentary: Vermont Needs School Choice to Fight Racism

February 7, 2020 By David Flemming While Vermont has less of a problem with racism at school than many states, it is still a problem. Recently, some Vermont...

Vermont’s Climate Crusade is Futile with or without GWSA

February 6, 2020 By David Flemming Under the GWSA, Vermont looks to continue its crusade to end climate change. But such weapons are far more likely to be...

Video