From the New York Times.com:
Struggling to find ways to pay for the president’s signature health care overhaul, the administration on Monday proposed to raise nearly $60 billion more over 10 years mostly from tightening rules for inheritance taxes affecting the wealthiest estates.
The Treasury Department’s proposals, and several others affecting taxation of life insurance and some other financial products, are intended to fill a gap that has opened up in President Obama’s health care plans.
Revised estimates show that his main idea for financing the initiative — a 28 percent limit on deductions for Americans in the top two tax brackets — would raise $266.7 billion over a decade, not $318 billion as he had projected in his overall budget blueprint last February.
Filling that gap actually understates Mr. Obama’s problems in paying for reforming health care. The deductions limit has hit a wall of opposition in Congress, with the Democratic chairmen of the House and Senate tax-writing committees among others objecting that it could depress tax-deductible charitable contributions. The proposal accounts for half of Mr. Obama’s proposed $635 billion, 10-year reserve fund to introduce cost-saving changes into health care and to expand coverage to the uninsured; the other half would come from Medicare savings under the Obama budget.
The latest proposals to raise revenues are included in documents from the Treasury and the Office of Management and Budget that provide new details on the preliminary budget released in February, when the administration had been in office just a month.
More than $24 billion of the nearly $60 billion to be raised over 10 years would come from estate and gift taxes that would hit less than three-tenths of 1 percent of estates in any year, according to a senior Treasury official, who spoke to reporters on condition of anonymity.