Americans in Israel protest tax clause in Obama health care plan

Americans in Israel prot

A group that helps Americans living in Israel is calling on its members to write their senators and protest a clause in US President Barack Obama's health care reform proposal that would charge an annual tax to Americans living abroad who opt out of coverage. The Association of Americans and Canadians in Israel sent out a mass e-mail this week calling on US expatriates in Israel to write their senators and demand that the provision be left out of the final version of the legislation. David London, AACI's executive director, says the group has seen a "tremendous, unbelievable" response to its mailing on the proposed tax. It's a subject that Americans are talking about "from Efrat to Ra'anana," he said. The issue has also swamped message boards on Web sites geared toward the approximately 80,000 Americans living in Israel, London said. If included in the version of the bill signed into law, individual citizens who opt out of a health care plan would pay an annual tax of $750, with a maximum tax of $1,900 per family. Because the proposed federal health insurance plans would not cover medical bills accrued outside the US, the bill would require expats to pay for coverage they couldn't use or to pay to opt out of coverage that would not apply to them. The US House of Representatives passed the Affordable Health Care for America Act by a 220-215 vote on November 7. The Senate is working on its own bill, and then the two versions would have to be merged and passed by both chambers to become law. While the clause in question was removed from the version of the bill approved by the House, the version to be voted on by the Senate currently includes the provision and could remain in the bill when it is becomes law. London said the AACI is not for or against health care reform, rather it launched the campaign to protect the interests of its community in Israel. The $750 per person tax "could be a serious financial blow to families living in Israel," he said. He added that the bill could set a precedent that would affect other Anglo immigrants, if their countries decided to follow the lead of the United States and include an excise tax in their health care coverage. It has not been determined whether or how the fee would be affected by tax treaties between the US and Israel that include broad income tax exemptions for Americans living in Israel. A spokesman for the US Embassy in Tel Aviv said on Thursday that he wasn't familiar with the clause, but that the bill is still very much a work in progress and changes could be made before it comes up for a final vote.