Fed Issue #23 - Federal Liberals eye tax on private health and dental plans, grabbing $2.9B

[mosquito]

Federal Liberals eye tax on private health and dental plans, a move that would take in about $2.9B
http://www.nationalpost.com/m/wp/new...-in-about-2-9b

The employee-sponsored health care tax exemption is being scrutinized as part of a sweeping review of 150 tax credits worth about $100 billion a year in foregone federal revenue.

** Translation - goal of taking $100 billion out of Canadians pockets
Most employee benefits are taxed – for example, life insurance paid by employers are reported on employees’ T4 slips and included as taxable income. Similarly, a car paid for by an employer is taxed.

But health benefits are an exception. Proponents of eliminating the credit argue that those with lower incomes but without private health plans are subsidizing those with employee-sponsored coverage.

On the other hand, there is a strong economic case for encouraging employers to provide health coverage for employees.

Quebec included health and dental plans as a taxable benefit in the early 2000s and found that employers scaled back the coverage offered.
...

** Translation - we want their money and don't give a s*** about working people

...
The 2016 budget removed the children’s fitness tax credit and the children’s arts tax credit.

** Translation - we want their money and don't give a s*** about working people' kids too

[terrym]

Sunny days.

[trimmer21]

But,he' has nice hair,though.

[Dythbringer]

But, ah, the, ah, budget, ah, will, ah, balance, ah, itself.

[JBen]

Read up on it. It is the right thing to do.
Providing the revenue actually goes towards (allows) for the offsetting tax credit.


The panel suggested the maximum tax credit would be $750 for a single person earning less than $44,000 or $1,500 for a family with income below $89,000.

This policy could be defended on the grounds that it would remove a distortion from the tax code that sees the relatively well-off (public servants and people who work for large companies) have their health and dental costs subsidized, while the four in 10 Canadians without workplace policies have to buy insurance from after-tax income.
http://news.nationalpost.com/full-co...y-down-deficit
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How often have we brought up that for the "average" person ( by definition those around the means). Who don't earn 70,000 as a single person, the mean is $70,000 duo.....don't have a Pension, can't save, are getting hammered. Working hard so others don't have to....
Or small business owners, or self employed....

4 in 10 Canadians have to get private insurance. That comes out of their after tax disposable income.
For people with companies and large plans its "gratis", where many other things be it a car/loan/mortgage/gym membership/life insurance it's a taxable benefit thats added to income for the calendar year.

So what they are talking about is taxing those plans (raising say 3billion) and then giving people who have to get their own plans a tax credit that might cost the Feds the same.

So take some person who earns say 80k, has a pension, has great benefits ( not taxed) and another person who earns say the same 80k, or a family, but has to pay for a private plan and pay for their own retirement..

Who needs it more?

[Waftrudnir]

it is about setting a different standard. yes, you might equalize here, but that one is just another step in LOWERING the overall living standards in Canada.
why not go the other way? why does health care need to be taxed to start with? we talk about health care plans that people have to get, because a good bunch of things are not covered by provincial medicare. so what is the share government takes here? it is not a tax that is used to build a road or school. you (or your employer) has to pay because the government does not do enough to begin with.
if I'm paying myself, why should government cash in for not taking sufficient care of their citizens?
I'm just always amazed how they manage to sell it to us. Just read a CP24 article that said cost of food will go up and Trump is to blame; carbon tax was not mentioned even once.

[terrym]

They are going to tax " Health care plans" not gym or club memberships or perq company vehicles. That tax money is not going to help those who can't afford health care. We all know it's going into general revenue to give civil servants raises. The Carbon taxes will reduce the capacity to buy food and now they are taking health care money too. When they get their own fiscal house in order then they will legitimately be able to look at new taxes. When Quebec implemented tax of health plans the workers suffered lower benefits and services covered. A huge part of health plans is prescription drugs. Many won't be able to afford them and likely end up in the hospital system at $$ thousands a day or add pressure to over worked and underfunded ER. This is not about health care. It's about retaining power by having money to lube the public service.

[JBen]

Did you bother to read the article Terry, because it doesn't seem like it.

Current tax code as I said treats things like LI, gym memberships, cars, etc...As Taxable benefits. Why not health/dental plans?

If your receiving something ( A benefit) from your company that saves you money, it is in essence income. Just because its not cash money, doesnt mean it isnt so. Maybe you favor a world where the company pays minimum wage and gives you loafs of bread instead so it's not taxable as income? Sounds like it...

So, if all these other things are treated as taxable benefits......

And then further.
Without arguement, it's irrefutable that the so called middle class is being pummelled.
Further 6 in 10 dont have Pensions, can't save
Further another 4 in 10 have to pay for their own private plans at full cost, with after tax dollars. I imagine a big chunk of these are the self employed and small businesses

Imo, walk a mile in their shoes.
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True, its possible they may do many things. Whether they do or dont doesnt change the merit of this.

[glen]

I would like to bring the less up not bring the more down.

We are all paying way too much now.

[JBen]

Agree Glen, but then the ? As always is how? That's rhetorical btw. But that "arguement" can be spun many ways.

Are the wealthy and well off not tearing the working stiffs down now as is?
Johnny Q is self employed. He and his wife gross $70,000. No Pension, no health/dental, so they pay for both with after tax dollars

Johhny P is employed in PS. Grosses $70,000 has an amazing tax payer funded pension and health/dental.

Always more than one way to look at things.

The key with this proposed change to tax code, is that benefits be they company cars, gym memberships, loans, Computers bought through the Co are taxed as "taxable benefits". In essence "income" over and above your salary. And why not?