Senate considers curbing tax-free status of employer-provided benefits
As part of a health insurance reform package now before Congress, some of the 164 million Americans who are covered by employer-provided health plans could be asked to give up at least part of the longstanding tax exemption granted to such compensation.
The idea of limiting the tax break for employer-provided insurance gained momentum last week, when Obama told senators that he’d consider it as one ingredient of the health insurance reform bill he wants Congress to pass by early August, when the Senate starts a one-month recess.
Obama’s new receptivity to the tax springs from the massive sums of money needed to pay for expanding health coverage to the uninsured.
Obama’s Council of Economic Advisors last week cited a figure of about $125 billion a year to insure the uninsured. But the president aims to do more than that. He also wants to subsidize the cost of coverage for lower-income people, subsidize COBRA coverage for those who lost their jobs and make other changes. [Translation: spend, spend, spend]
Obama’s new openness to the idea stands in contrast to what he said six months ago as a presidential candidate, when he harshly criticized his Republican rival, Sen. John McCain, for proposing that employer-provided benefits should be taxed:
“This is your plan, John. For the first time in history, you will be taxing people's health-care benefits.”
According to the congressional Joint Committee on Taxation, the Treasury 'misses out' on $226 billion a year because employer spending on health insurance isn’t counted as taxable income.
[I.e., they think it's their money.]
READ MORE
No comments:
Post a Comment