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IRS scandal becomes Republican battering ram against Obamacare (+video)

Republican lawmakers say the scandal over Internal Revenue Service scrutiny of conservative groups raises new doubts about President Obama’s health-insurance reform law.

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Republicans and Democrats alike have denounced the IRS in recent days for scrutinizing conservative groups seeking a tax exemption but not similar liberal groups. It’s not that the IRS has no business weighing the tax status of political groups – the lines for qualifying for a tax exemption can be fuzzy. But the widespread perception is that the IRS stepped over a line.

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By extension, some IRS critics say, this raises the fear that some aspects of Obamacare implementation could be handled along partisan lines.

Some Democrats say it’s Republicans, not the IRS, that is overreaching when it comes to the health-care law.

The head of the IRS health-care office, Sarah Hall Ingram, was in charge of the tax exempt division in 2010, when agents first started improperly targeting conservative groups over their applications for tax-exempt status, according to The Associated Press.

"[But] there isn't any evidence that Sarah Ingram had any inkling of the problems" before she changed jobs to help implement the health-care law, Rep. Sander Levin (D) of Michigan said, according to the AP.

Biased or not, the tax agency has a large new role to play under the Affordable Care Act. But its job is just part of the law’s labyrinthine scope, which extends from an expansion of Medicaid for the poor to new rules that bar insurers from denying coverage on the basis of someone’s health status.

Republican critics say the Affordable Care Act, with its numerous regulations, will make health care more expensive and is making many businesses reluctant to hire new workers or to keep offering coverage to employees.

Supporters of Obamacare say that most businesses will continue health benefits, and that some 30 million more Americans will have health insurance under the law. Premium costs may rise for individuals buying insurance, but the law provides subsidies to help moderate-income households pay for it.

The law’s connection with the IRS was underscored in a 2012 US Supreme Court decision, which ruled that the law’s mandate on individuals – to buy insurance or pay a penalty – is constitutional because the penalty is in effect a tax.

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