Thanks to Obamacare, small businesses are now eligible for tax credits for providing insurance to their workers. In 2014, the tax credits increase.
This is nothing to be thankful for. First, this policy just entrenches a fundamental problem with medical insurance in the United States: tax policy favors non-portable job-based insurance which stifles competition and discourages wise consumption of medical care.
What’s worse, the tax credit is cumbersome. As the Associated Press reports:
Obama’s health care aid to small firms disappoints
Many small businesses struggle to afford health insurance for their workers, but a a new tax credit meant to help them seems to be turning into a disappointment. Although opinion polls show the credit is one of the most popular ideas in President Barack Obama’s health care law, only 170,300 businesses out of a pool of as many as 4 million potentially eligible claimed it in 2010, about 4 percent.
A recent government report found the tax credit time-consuming to apply for and not rewarding enough to be financially attractive. …
Trying to help, the IRS identified “three simple steps” employers needed to follow, but the GAO found “the three steps become 15 calculations, 11 of which are based on seven worksheets, some of which request multiple columns of information.”
Read the whole article: Obama’s health care aid to small firms disappoints – The Denver Post.