WASHINGTON D.C. - February 14, 2017 - Most New Jersey employers and employees are unaware of Republican efforts to eliminate the employer tax exclusion under employer-sponsored plans, affecting an estimated 177 million people across the country.

 

On Capitol Hill today, NJAHU members are meeting with members of Congress and staff to stress the employer-based system is highly efficient at providing American workers and their families with affordable coverage options.

 

New Jersey companies and their employees benefit from group purchasing and its associated economies of scale by spreading risk and avoiding adverse selection. The success of this system is possible because of the preferential tax treatment of employer-sponsored insurance coverage.

 

Premiums paid for employment-based health insura nce are excluded from federal income and payroll taxes. The tax exclusion saves workers over  $250 billion a year in federal taxes, and billions more in avoided state taxes. For the average worker, that reduces the cost of their health coverage by at least 30 percent, Forbes reports.

 

"Proposals that would cap the maximum value of the exclusion or eliminate it altogether would be detrimental to the stability of the employer-based market and would negatively affect many middle-class New Jerseyans who currently benefit from this provision," said NJAHU President Toby Stark.