How Will Trump's Health Care Bill Affect The Rich? Huge Tax Cuts For Wealthy People Under New Act

President Donald Trump's health care bill, American Health Care Act (AHCA), was passed in the House last week and has now moved to Congress' upper chamber for approval.

Reports however say the debate has already begun regarding who will win and lose from Trump's health care act, which could transform health insurance system in the U.S. The Senate, most likely, will demand changes in the bill, however, if it becomes a law in its current form, it will repeal and replace large portions of the Affordable Care Act (ACA), also known as Obamacare.

Any change in the health care system implies insurance will become more affordable for some, while others may lose out on financial support or health care coverage, the New York Times reported.

Read: American Health Care Act Cover Only 5%, Might Increase Health Insurance

The bill would benefit the wealthy Americans, especially those households with annual incomes above $200,000, as they would not have to pay two major taxes levied on them as part of the Affordable Care Act while the very rich families would fare even better.

Tax Policy Center (TPC) — a nonpartisan think tank based in Washington D.C.— said the average household from the top 0.1 percent of income distribution would save around $196,000 a year if the tax on high salaries as well as investments are repealed under Trump's health care, Chicago Tribune reported.

Experts say Trump's health care bill gives huge tax cuts to the richer people. Howard Gleckman , a senior fellow at TPC said in March: "The effects are really very dramatic. We found that a typical middle-income family would get a tax cut averaging about $300, while people in the top 0.1 percent would get a tax cut of about $207,000," according to Reuters.

Under Trump's health care bill, the Medicare surtax on wages for rich people will be eliminated. In Obamacare, the high-income group used to pay 1.45 percent Medicare payroll tax on wages up to $200,000 ($250,000 if married). They would also pay an additional 2.35 percent on wages above those levels.

However, under Trump's health care plan, the surcharge of 2.35 percent would be repealed. That income group will also forego a 3.8 percent Medicare tax on a portion of their investment income, CNN Money reported.

The tax cuts for the rich are not randomly chosen. When the Democrats introduced the ACA in 2010, they had increased taxes for the higher-income group to help the benefits of the ACA, and Republicans had opposed those increases at the time. They have been arguing ever since to remove those tax increases.

When Trump's health care bill was passed in the House last week, many AHCA supporters framed the vote as an initial victory over those tax increases. Thomas J. Donohue, the president and CEO of the U.S. Chamber of Commerce, said in a statement the bill would “pull back on job killing tax hikes that have been stifling economic growth across the country.”

However, those who are against the new health care bill have criticized it for being beneficial just for the wealthy classes, while neglecting the lower income groups. The opinion seems to have been seconded by Warren Buffet, Berkshire Hathaway Chairman.

During Berkshire's annual shareholders' meeting Saturday in Omaha, Nebraska, Buffet said: "So it is a huge tax cut for guys like me…And when there's a tax cut, either the deficit goes up or they get the taxes from somebody else."