CBO Says Excise Tax to Hit 19 Percent of Job-Based Health Plans

For over 50 years, Bloomberg Tax’s renowned flagship daily news service, Daily Tax Report® has helped leading practitioners and policymakers stay on the cutting edge of taxation and...

The Senate's health care overhaul legislation (H.R. 3590) debate begins with a new CBO report showing that nearly one in five employment-based health insurance policies would be subject to a 40 percent excise tax by 2016. Under current law, CBO says 19 percent of employment-based health plans would be affected by the tax on “Cadillac” insurance plans as the cost of their premiums reaches the threshold levels of $8,500 for individuals and $23,000 for families. “For policies whose premiums remained above the threshold, the tax would probably be passed through as a roughly corresponding increase in premiums,” CBO says. Republicans seize on the report as evidence that the bill will raise health insurance costs for most Americans.

Request Daily Tax Report