A September Issue Brief from National Taxpayers Union Foundation (NTU Foundation) calculated that new tariffs imposed by the Trump administration will exceed Affordable Care Act (ACA) taxes in 2019.
This conclusion was cited in an October 10 Washington Examiner op-ed.
Politifact rated this conclusion as “Half True.” NTUF stands by its findings. The criteria that Politifact used to issue its “half true” rating have nothing to do with the facts we presented and instead evaluates claims we never asserted. The facts remain: tariffs imposed by the Trump Administration will cost Americans more than the taxes imposed by President Obama’s Affordable Care Act.
Politifact raised questions about the tax cost of the ACA and the projected cost of tariffs in 2019. According to Politifact, “... while the National Taxpayers Union is mainly correct in terms of the new taxes, it doesn’t quite capture all of the tax money that funds health care.”
That may be correct, but our op-ed specifically compared tariff revenue to “tax increases from the Affordable Care Act,” which is a specific piece of legislation that has been scored by the Congressional Budget Office, not to other tax money that funds health care.
Politifact further suggests, “... employer mandate penalties would add as much as $8 billion to the total in 2019, according to Congressional Budget Office estimates. That would bring the total of ACA-imposed taxes somewhere around $42 billion, which exceeds the estimated cost of the tariffs.”
Whether penalties should be counted as tax increases is debatable. More significantly, the op-ed noted that an additional $30 billion in tariffs is slated to take effect on January 1. This would bring the cost of tariffs to $71.65 billion in 2019, an amount far greater than ACA taxes and penalties.
Politifact notes that NTUF’s tariff revenue estimates are based on 2017 import volume, an amount that is not set in stone.This is true, as I said in my interview to Politifact. The numbers we analyzed are based off of the best-available data, which as most analysts who work with economic forecasting know, can only be characterized as estimates. The CBO makes estimates, the Office of Management and Budget makes estimates, and every piece of macroeconomic data could be most accurately characterized as an estimate. If relying on “estimates” is a reason to doubt a claim, as Politifact’s argument implies, then no assessments of future policy impacts can be relied upon.
Even if import volume declines in 2019 due to the new taxes, and regardless of how the burden of the tariffs is distributed, NTUF believes it is entirely reasonable to conclude that tariff revenue collected in 2019 from the Trump administration’s new trade taxes will exceed 2019 ACA taxes.
We stand by our claims and rate Politifact’s assessment as “half fair.”