Immigration Bill May Reduce Obamacare Employer Fines

The fines incentivize businesses to hire immigrants over citizens


The Senate Gang of Eight is working to fix the unintended hiring advantage their bill would give to newly legalized immigrants over U.S. citizens as a side effect of ObamaCare.

A careful analysis suggests that any politically realistic fix likely has to involve sharply reducing the health law's employer fines.

As first reported by IBD, many employers will owe up to $3,000 per full-time worker who taps ObamaCare's insurance exchange subsidies. But newly legalized immigrants would be ineligible for those subsidies.

As a result, many employers deciding whether to employ a legalized immigrant or citizen full-time would have a big incentive to favor the immigrant. Because the annual fine of up to $3,000 is nondeductible, it is equivalent to as much as $5,000 in wages for companies paying a combined 40% federal and state tax rate.