NJ Citizen Action highlights pharmaceutical company tax breaks in new report
NEWARK, NJ – May 17, 2021 – As Congress prepares to discuss President Biden’s proposals to increase taxes on the rich and corporations as part of his “Better Back Down” stimulus and recovery package, state and state advocates released a new edition on this tax day, in which the tax hike is advocated, pharmaceutical companies will finance investments in the affordability of health care.
New Jersey Citizen Action, in partnership with the National Healthcare Over Wealthcare Project, which supports tax justice reforms to generate more revenue, published a short report entitled “Congress Must Get the Rich and Corporations to Pay Their Fair Share of Taxes to Support Healthcare and Economic Recovery ”Expanding the Health and Safety Network. The letter describes how, because of the Trump-Era Tax Cut and Jobs Act (TJCA) and longstanding tax loopholes, the rich and corporations continued to thrive while those on average incomes lost jobs, incomes and health care during the pandemic.
For example, in New Jersey, where 1,009,521 people have been infected with COVID and many are still struggling to restore health and economic stability:
- 571,000 in the state are struggling to afford enough food;
- 356,000 fight for the rent;
- The unemployment rate remains high at 7.8% and there are 332,300 fewer jobs today than at the start of the pandemic.
Conditions could get worse if the Supreme Court repeals the Affordable Care Act (ACA) and the expansion of Medicaid, a source of health care for 832,360 New Jerseyites that also provides consumer protection to 1,359,000 people with pre-existing conditions in the state. The Supreme Court will again decide on the constitutionality of the law this summer.
As millions of Americans lost jobs and health care in 2020, the wealthiest prescription drug households and businesses continued to receive tax breaks during the pandemic. The richest 1% of households in New Jersey received a tax break of $ 37,640 last year, while the poorest households that earned less than $ 24,000 received $ 100.
Prescription drug companies, some of which are New Jersey based and have already received billions in tax breaks under the Trump Tax Act, have increased their prices on hundreds of drugs in both 2020 and 2021. However, they still receive tax breaks, even if you raise the prices so high that a third of the insured cannot afford any medication.
|Rx Drug Company Savings from Trump Tax Cuts – 2018|
|Companies||State seat||Estimated tax cut|
|Merck||New Jersey||$ 2.1 billion|
|Pfizer||new York||$ 2.0 billion|
|Johnson & Johnson||New Jersey||$ 1.8 billion|
|Amgen||California||$ 1.2 billion|
|AbbVie||Illinois||$ 1.1 billion|
|TOTAL||$ 8.2 billion|
|Source: Capital ONLY|
Some of the largest of these companies, including Johnson & Johnson and Pfizer, also received billions in taxpayers’ money to develop, manufacture and distribute the new COVID-19 vaccine. Pfizer recently announced that the vaccine is expected to generate sales of $ 26 billion in 2021. The price of prescription drugs is rising faster than any other good or service, even as drug demand increases due to COVID.
“Nobody should have to choose between paying for medication and other basic necessities like food, rent or transportation, but many like me are forced to do so every month,” said Lisa Wetzel-Trainor of Princeton. “After suffering trauma at age 16, I was diagnosed with PTSD and ADHD at age 19. Prescription medications are critical to managing my symptoms and daily life. Due to a 2020 change in my husband’s insurance policy, I am no longer insured for Vyvanse, a key recipe for which there is no generic alternative. I had to stop taking the drug because of the exorbitant cost of $ 1000 per month altogether and my quality of life has dropped significantly. Americans can’t live like this. Congress must demand affordable drug bills from these companies instead of giving them billions in tax breaks on a silver platter. “
President Biden’s Made in America Tax Plan would generate approximately $ 3.6 trillion in revenue from a combination of corporate tax hikes, tax hikes for households over $ 400,000, closing loopholes and strengthening tax law enforcement. especially for higher income taxpayers. Drug companies would face increased domestic and increased offshore rates for profits in tax havens. The proceeds would support popular investments like increased tax credits for those buying ACA coverage, childcare and family vacation extensions, jobs, and infrastructure repairs.
“The average American struggles to get the health care and medicine they need while drug companies continue to raise prices and receive huge tax breaks,” said Maura Collinsgru, director of health programs at NJ Citizen Action. “President Biden’s proposals to increase corporate tax rates for companies like these pharmaceutical companies are long overdue. Patients currently pay three times for prescription drugs: once for research and development, once at the pharmacy, and then again for the tax breaks these companies receive annually. It’s time to turn the script around and get them to pay their fair share. “
New Jersey Citizen Action (NJCA) is a statewide advocacy and services organization that advocates social, racial, and economic justice for all while meeting the urgent needs of low and middle income New Jersey people through education and direct service.
Health Care for America Now (HCAN) is a grassroots coalition of state and national groups that led the struggle to pass the landmark Affordable Care Act (ACA). Healthcare Over Wealthcare is a campaign by Health Care for America Now committed to prioritizing investments in equitable, affordable health care for all over tax breaks for the rich and corporations.
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