What more do we know?
- Twenty-four million Canadians have care because of current benefit plans.
- The present employer-sponsored health and dental care tax exemption encourages employers to offer benefit plans to employees for essential health services that have been excluded from Canada's public health care system.
- Healthcare Spending Accounts (HSA) could become irrelevant if they are taxable.
- Currently, tax free employee benefit programs are viewed as an important part of an employees' total compensation package and this new tax could make it more difficult to attract and retain new human resource talent.
- When Quebec introduced a similar tax, 20% of employers dropped health and dental benefits for employees.
- Studies suggest the removal of this tax benefit across the board could result in a decrease of 50% of small firms that will be able to offer health benefits.
- According to a recent IPSOS poll:
- 70% of Canadians are opposed to this plan,
- 48% said they would prefer to take cash over health benefits if they were taxed at the same rate, and;
- 84% would end up delaying or forgoing treatment or medication if they didn't have coverage.
- One proposal to counter the effects of the imposed taxes, as suggested in a report last year from the Advisory Panel on Healthcare Innovation, is to introduce a new tax credit - Refundable Health Tax Credit (RHTC).
- The RHTC would provide the following maximum tax credits:
- Single (income less than $44,000) - $750
- Family (income less than $89,000) - $1,500