Better Ways to Pay For Health Care: Taxing Health Benefits, Ctd

by Patrick Appel

A reader writes:

One minor nit-pick.  It is very common for people to discuss how no-one pays taxes for their employer provided health care benefits.  This is flat out untrue.  I pay taxes on the majority of my health care benefits from my provider: those that cover my partner.  Because of DOMA, my partner's benefit costs (which are higher than the employee rate) are fully taxable while my co-workers do not have to pay taxes for their spouses' health care benefits.  It is very frustrating to hear people who espouse "no special laws!" when opposing gay rights who then go on to complain at the merest possibility that they might have to pay taxes on this portion of their compensation from their employer.  I support the tax on health care benefits for the reasons Conor Clarke listed, but I add a fifth: fairness.