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Disappointment: Gov’t Warned Tax On Health Insurance Will Be Damaging

RJR News /  

Another warning has come that the Andrew Holness administration is heading in the wrong direction with the tax on group health insurance premiums.    Finance Minister Audley Shaw, in closing the Budget Debate on Wednesday, defended the tax measure which takes effect on April 3.    Insurance companies and small businesses have argued that it will make the benefit too expensive and result in fewer persons being insured.    Richard Byles, Chief Executive Officer of Sagicor Jamaica, has expressed disappointment that the Government did not yield to calls to reconsider the tax. “I understand he has to close the gap but was there nothing else?” he questioned, adding that the country should now brace for the repercussions. “My views remain unchanged. It is not the right tax to do, it is an error, and as I said before, he is not going to collect all the tax he wants. Small businesses are going to drop health insurance and those that keep it are going to have less benefits on the card. Hospitals will get less revenue and therefore, the taxes will be less too,” argued Mr. Byles. Reconsider Meanwhile, the Jamaica Insurance Brokers Association has objected to the taxation on group health insurance and overseas insurance payments. It is urging the Finance Minister to reconsider the decision.    The association said the taxes will increase the cost to companies and could result in a scaling back or possible withdrawal of group health benefits.    According to the association, statistics last year indicated that a third of Jamaica’s work force had access to health care because of  insurance coverage.    The Jamaica Insurance Brokers Association wants Mr. Shaw to withdraw the proposed tax on overseas insurance payments because of the threats it poses to the viability of companies within the group.    It expressed disappointment that there was no dialogue before the tax measures were proposed.

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