Cotton 'Reminds' Democrats the Obamacare Individual Mandate Is a Tax

November 15, 2017

Sen. Tom Cotton (R., Ark.) on Wednesday responded to Democrats who are criticizing the Senate Republican tax reform bill for repealing Obamacare's individual mandate, reminding them how the Obama administration argued before the Supreme Court that the requirement is a tax.

Speaking on the Senate floor, Cotton addressed Senate Minority Leader Chuck Schumer's (D., N.Y.) comments earlier in the day that Republicans are "injecting health care into the tax bill" by including a repeal of the individual mandate, which forces most Americans who do not have health care to pay a fine.

"I would remind him, and all of the other Democrats who have been denouncing this decision on the Senate Finance Committee, that the individual mandate is a tax, according, not to me, not to Republicans, but to the Obama administration," Cotton said. "That is what they argued in 2012 to the Supreme Court even though, he contended, throughout the debate on Obamacare in 2009 and 2010 that it wasn't a tax."

Back in 2009, then-President Barack Obama repeatedly pushed back against the notion that the individual mandate is a tax, saying in an interview with ABC's George Stephanopoulos that it is "absolutely not a tax increase."

Cotton then noted that the Supreme Court in 2012 upheld the Obama administration's argument that the individual mandate is a tax, which helped save Obamacare from multiple legal challenges.

"In 2012 they argued to the Supreme Court that the Obamacare mandate is a tax, and the Supreme Court in 2012 upheld it, as a tax," Cotton said.

The Senate majority leader at the time, Harry Reid (D., Nev.), spoke on the Senate floor after the ruling, saying, "Our Supreme Court has spoken. The matter is settled."

To explain why the individual mandate is a tax, Cotton noted that money from the requirement is collected on Americans' 1040 tax form when filing their annual returns.

"It's collected by the IRS; it doesn't get much more taxy than that," Cotton said.

Cotton then discussed what repealing the individual mandate does.

"It doesn't cut a single dime out of Medicaid, it doesn't cut a single dime out of insurance substitutes for people on the exchanges, and it doesn't change a single regulation of Obamacare," Cotton said. "All it says is the IRS cannot fine you for being unable to afford the insurance that Obamacare made unaffordable in the first place."

Under the current law, if Americans can "afford" health insurance but choose not to buy it, they can be fined in one of two ways: as either a percentage of their household income, or per person. If the former, Americans are required to pay 2.5 percent of household income or a maximum of the total yearly premium for the national average price of a Bronze plan sold through the Obamacare marketplace. If the latter, Americans are fined $695 per adult, $347.50 per child under 18, and a maximum of $2,085.

"And let me tell you, more than five out of six households who pay that fine make less than the median income in this country," Cotton said. "That is a direct tax on working families and poor people because they can't afford the insurance that Obamacare made unaffordable."

"What we are doing is replacing the most hated tax of Obamacare and giving the American people the freedom to choose insurance that is right for them without being threatened by a fine from the IRS if that insurance doesn't meet some Washington bureaucrat's definition of what is suitable," Cotton said.

"That's why two-thirds of the American people support the repeal of the individual mandate," Cotton added. "And that's why when we repeal it, the American people are going to have a big victory."