It does not seem fair to allow people's employers to provide insurance tax free while at the same time not allowing those who purchase insurance on their own to not be able to deduct the cost. I'm not saying it is a great idea to tax the benefit (income) but it is a good idea to allow for the deduction.
Besides I imagine that the amount an employee spends on insurance would also be deductible and most times would be larger than the additional tax on the employer provided benefit.
Quote:
The basic concept of the plan is that employer-provided health insurance, now treated as a fringe benefit exempt from taxation, would no longer be entirely tax-free. Workers could be taxed if their coverage exceeded limits set by the government. But the government would also offer a new tax deduction for people buying health insurance on their own.
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The Bush administration estimates that 80 percent of people with employer-provided plans would see their tax liability fall because the deduction would be larger than the value of their insurance plans.
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