Potential health benefit tax could cost you hundreds of dollars
Did you know the federal government is considering taxing employer-sponsored health and dental benefits? If you have health and dental coverage through your employer, this new tax could add hundreds or even thousands of dollars to your annual tax bill.
What is being considered?
In an effort to generate more revenue, the federal government is considering a tax on employer-sponsored health and dental benefits. This tax could have a negative impact on you and your employer. While full details have yet to emerge, Alberta Blue Cross and other benefit carriers across Canada are concerned that this new tax is being considered. If included in the 2017 federal budget, health and dental plans could be considered a taxable benefit so the employer-paid portion of your benefits would be considered income.
Why does this matter?
Other than owing more income tax, this change puts your health benefits in jeopardy. Many small and medium-sized businesses may choose to cancel their group benefit plans because they would be forced to pay the extra costs of administrating this additional tax. This would have an adverse impact on the millions of Canadians whose employers currently provide access to benefits that not only deliver practical coverage to help employees maintain their health but provide protection against the unexpected cost of chronic illness or injury.
Has this already been done anywhere in Canada?
In the early 1990s, the province of Quebec began taxing the employer-paid portion of health and dental benefit plans. This resulted in hundreds of businesses cancelling their group benefit plans and many Quebec residents losing access to their health and dental benefits.
What can I do to stop this proposed tax?
You can take action by sending a letter to your local Member of Parliament and the Minister of Finance. Visit www.donttaxmyhealthbenefits.ca to fill out a quick online form through which you can direct an email to your elected representatives.