Baucus' Taxing Issue

Here's an issue Democrats and Republicans in Washington almost agree on: taxing health care plans.

Of course Republicans were going to skewer Senator Max Baucus' health reform proposal. But the Montana lawmaker also is getting a lot of flack from fellow Democrats on a measure to raise billions for health reform by taxing gold-plated insurance plans.

Democrats say the proposal will hit the middle class, particularly union members.

Senator John Kerry, who initially proposed the idea, says Baucus set the threshold too low in determining which plans get taxed. The measure offered by Senate Finance Committee Chairman Baucus this week would impose a 35 percent tax on any health insurance family plan that's valued at more than $21,000 a year. Kerry thinks that figure should be raised to at least $24,000.

“Working folks with a lower level of income will get dragged in” under the Senate Finance Committee plan, Kerry tells the New York Times.

The issue is a big one for labor and don't think the unions won't have the Democrats' ear. The Service Employees International Union, a major Democratic backer, says a tax on the so-called Cadillac plans is unfair.

"A tax on high-cost plans will unfairly burden older workers and workers in high-cost states," SEIU boss Andy Stern says in a statement this week.